New accounting rules shed some light on the profitability of electric vehicle manufacturer Tesla’s Bitcoin (BTC) investment.
Tesla’s Q4 2024 report released earlier today shows that the company valued its Bitcoin holdings at just over $1 billion. This is significantly up from the $184 million worth of Bitcoin that the company reported over past quarters.
The details
This translates to a gain of $589 million for Tesla on its Bitcoin holdings over a single quarter — reaching 9,720 BTC according to data provided by Bitcoin Treasuries. The information is circulating following the introduction of a 2023 Financial Accounting Standards Board rule that came into effect last month.
The new rule allows corporate crypto holders to include the estimated market value of their digital assets on their balance sheets. Until this rule came into effect, the digital assets held by companies were downplayed on their balance sheets. Previously, the recorded digital asset value could not increase until the asset was finally sold — even if its value actually increased.
Tesla reported an income of $2.3 billion in the Q4, which includes the $600 million profit off the firm’s Bitcoin holdings. The automaker’s revenue show a 2% year-on-year increase.
The report comes after in August 2024 Tesla CEO Elon Musk suggested that a collapse of the United States dollar is coming, while recognizing the merits of crypto. He said:
“I do think there’s some merit in bitcoin, and maybe some other crypto. […] I’ve sort of got a soft spot for dogecoin because I like dogs and memes.”
Musk is rumored to be working on integrating crypto features into his social media platform X. As recently reported, Linda Yaccarino, the CEO of X, recently hinted at “X Money,”which many speculate could feature Bitcoin or Dogecoin (DOGE) integrations. She wrote:
“2025 X will connect you in ways never thought possible. X TV, X Money, Grok and more. Buckle up.”