Tesla sells nearly 75 percent of bitcoin holdings

Electric car manufacturer Tesla has sold nearly 75 percent part of its bitcoin stake.

The move came as a surprise to the market given the role CEO Elon Musk has played in the promotion of bitcoin as a mainstream currency option. The company invested US$1.5 billion in the cryptocurrency last year, although it sold 10 percent of that amount after two months.

“This should not be taken as some verdict on bitcoin,” Musk said in a recent call with analysts.

According to Bloomberg, the executive pointed instead to concerns about COVID-19 shutdowns in China, which he said are affecting his company's liquidity.

The bitcoin sale added US$936 million in cash to Tesla’s balance sheet. In its report, Bloomberg indicates that the move represents a hawkish tactic from Musk during a downturn for the entire cryptocurrency market.

Retail investors lift cryptocurrency-related stocks

A new dataset from VandaTrack shows that there’s been a recent uptick in some of the most beaten-down public names in the cryptocurrency market thanks to retail investors.

“Retail traders are definitely surfacing here,” Ed Moya, senior market analyst at Oanda, told Bloomberg.

“Everyone expected one last major plunge for Bitcoin and now prices are recovering and risk appetite on Wall Street is somewhat improving.”

Over the course of 10 days in July, retail investors bought approximately US$1 billion worth of shares in the space. Some cryptocurrency-exposed names jumped by at least 50 percent as a result, although they are still seeing year-to-date downturns.

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From around the web

• In a new report, CoinDesk states that the difficulty of mining a bitcoin block fell by 5 percent in July, representing the third decrease in a row. Climate conditions in Texas have led some miners to turn off their machines, and with less competition the difficulty of mining for the coins decreases.

• July was the best month for bitcoin in 2022, according to Bloomberg, with a 27 percent increase in value for the digital asset. In fact, July was the best month for bitcoin since October of last year.

• Investors got a significant update about the progress of the cryptocurrency market by way of a new joint report from Bitget, Boston Consulting Group and Foresight Ventures. The report proposes that the adoption of cryptocurrencies will continue, and states that they may be used as a “potential hedge against inflation.”

One last thought…

The report from Bitget, Boston Consulting Group and Foresight Ventures also offers a point of interest for investors when it comes to how to evaluate growth within the market.

“Crypto exchanges … cannot easily monetize data or technology,” the researchers said, explaining that traditional growth measurements like revenue are tricky to apply in this market.

The researchers believe crypto operators could become serious financial players in the potential Web3 world.