Tesla is an EVM, and MicroStrategy is a business intelligence firm. What both these organizations have in common is that they are both heavily invested in Bitcoin, the top cryptocurrency in the blockchain sector. However, at present, the situation in the cryptocurrency market is looking somewhat dire, with the bear market coming back with a vengeance.
Under the current circumstances, MicroStrategy and Tesla CEOs have decided to combine their impairment losses which are estimated at around $1.5 billion. At present, the crypto community is asking the question of whether the commercial crypto giants will keep on holding their investments or decide to sell off. It is worth noting that selling on the part of any of the two whales can result in a further decline in the prices of Bitcoin.
Many people have purchased Bitcoin fairly recently, and retail investors have been feeling the burn of the bear market for quite some time. However, it is a rare occasion to see the biggest commercial investors of Bitcoin, like Tesla and MicroStrategy, sustain losses on their Bitcoin purchases. The collective losses of both biggest Bitcoin commercial investors are estimated at around $2 billion.
As per the data projections shared by Bitcointreasuries.net, the 130K units held by MS and 43K units held by Tesla are now below their buy-in prices. In addition to feeling the pressure from the bear market on its Bitcoin purchases, MS is also dealing with another blow from the stock market as its equities dropped to the lowest levels in months recently.
Impact of Tesla’s Bitcoin Reserves on the Crypto Market
Tesla CEO Elon Musk added 40k plus Bitcoins last year before the bull market, which generated a profit of $1 billion in profits. However, the latest turn of the crypto market has cleared out the profits. The total cost for the acquisition of these tokens by Tesla is valued at $1.5 billion, and at present, the price of the tokens under the possession of EVM is valued at around $1 billion.
It is worth noting that during its second ATH peak last year in November, the market cap of Bitcoin rose above Tesla. At present, the capital value of Tesla is estimated around $721 billion; on the other hand, the market cap of Bitcoin is less than $500 billion. However, the experienced traders in the market are confident that the recent fall is another opportunity for the investors to add more Bitcoins from the dip.