Elon Musk-led electric vehicle maker Tesla reported a $600 million paper gain from its bitcoin holdings in the fourth quarter of 2024 under an updated accounting rule that lets companies adjust the value of digital asset holdings at market prices each quarter.
Prior to the Financial Accounting Standards Board rule that came into effect last month, a firm’s crypto holdings value decreased on the books if they lost value during the accounting period.
Even if the market value rose, crypto asset holdings could not be revalued until sold, which made a company’s crypto assets appear weaker than market value.
With the new rule, Tesla’s digital asset holdings value grew to $1.076 billion by the end of 2024 from $184 million the previous quarter.
In the last three months of 2024, bitcoin grew over 50% on the back of crypto proponent Donald Trump’s reelection as U.S. President and strong inflows and volume seen in spot bitcoin exchange-traded funds. Bitcoin repeatedly renewed its all-time high record during the quarter, alongside gains seen throughout other cryptocurrencies.
Bitcoin is changing hands at $105,020 at the time of writing, up 2.88% in the past 24 hours, according to The Block’s bitcoin price page.
Meanwhile, Tesla did not reveal its bitcoin holdings in the Q4 report.
Arkham Intelligence data shows that the company holds around 11,509 BTC, roughly valued at $1.21 billion. This makes Tesla the fourth largest publicly traded holder of bitcoin behind MicroStrategy, Marathon Digital and Galaxy Digital, according to CoinGecko.
With the $600 million gain from digital assets, Tesla reported a generally accepted accounting principles (GAAP) net income of $2.3 billion in Q4, and a total of $7.1 billion net income in 2024. Its adjusted earnings-per-share stood at $0.73, lower than the expected $0.76.
Tesla stocks closed down 2.26% to $389.1 on Wednesday, but rebounded 4.15% during after-hours trading, according to Google Finance.
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