Tesla's Bitcoin Bet Pays Off: $600M Gain in Q4

Tesla, the electric vehicle manufacturer led by Elon Musk, has reported a significant paper gain of $600 million from its Bitcoin holdings in the fourth quarter of 2024. This gain is attributed to a new accounting rule that allows companies to adjust the value of their digital asset holdings at market prices each quarter.

Tesla's Bitcoin holdings remained steady at 9,720 BTC, maintaining its position as the sixth-largest public company to hold the asset on its balance sheet. The company's BTC was valued at $1.07 billion at the end of 2024, up from $184 million during previous quarters. This increase was reflected in a GAAP income boost of $600 million on its digital holdings.

The updated accounting rule, which came into force last month, allows companies to adjust the value of their digital asset holdings at market prices for each quarter. Previously, companies had to report their digital asset holdings at their lowest valuation at the time of ownership, which could make the company's digital asset holdings appear weaker than their market value.

Bitcoin has surged over 50% since November 2024, driven by Donald Trump's election victory and inauguration earlier this month, as well as strong inflows into spot Bitcoin ETFs. BTC saw new all-time highs during Q4 after shattering the $100,000 level, with its latest all-time high coming as recently as January 20. The flagship cryptocurrency is currently trading around $105,300, up nearly 3% over the past 24 hours.

Tesla's gain from digital assets contributed to a GAAP net income of $2.3 billion in Q4 and a total of $7.1 billion net income in 2024. The company's adjusted earnings-per-share were reported to be $0.73, slightly lower than the expected $0.76.

In October 2024, Tesla moved a significant chunk of BTC to undisclosed addresses, sparking speculation about a potential sale. The BTC was moved to wallets not associated with known crypto exchanges. Tesla has held BTC since 2020, when it disclosed the acquisition of $1.5 billion worth of the asset, making it one of the largest corporate