Tesla Transfers Entire $765M Bitcoin Holdings Raising Speculation in the Market

Sentiment Status: Neutral

One theory for Tesla’s lack of official announcement is that they may be switching custody providers, as their Bitcoin was previously held by Coinbase Prime Custody.

Tesla has transferred its entire Bitcoin stash, worth over $765 million, to several unknown wallets. The transfer, made on October 15, had data showing 11,500 Bitcoin moved across 26 transactions.

Before the massive transfer, Tesla's Bitcoin wallet was inactive since June 2022, when the company last made a major Bitcoin sale. On October 15, at 8:41 pm UTC, the first test transfer was recorded, with only $6.68 of Bitcoin remaining in the wallet after all transactions were completed.

Tesla’s silence regarding the transfer raised questions about whether it still holds control of the Bitcoin or if it is preparing to sell it. Furthermore, no evidence suggests the Bitcoin has been sent to any crypto exchanges, signaling that this could be an internal reorganization of Tesla's holdings.

The company first announced in February 2021 that it had purchased $1.5 billion worth of Bitcoin, making its entry into crypto. Soon after, in early 2021, Tesla sold about 10% of its holdings. Then, in 2022, Tesla offloaded 75% of its Bitcoin, leaving it with 11,500 BTC, which it held onto until this recent transfer.

Tesla CEO Elon Musk, briefly accepted Bitcoin as payment for Tesla vehicles in March 2021, but the decision was quickly reversed, acknowledging environmental concerns related to Bitcoin mining.

Several theories have emerged as Tesla has not made an official announcement. One possibility is that the company could change its custody service provider. Previously, Tesla's Bitcoin was held by Coinbase Prime Custody.

Tesla's sudden shift in Bitcoin holdings has not yet impacted the market. Historically, large Bitcoin movements from high-profile holders, especially companies like Tesla, have caused market volatility, but so far, Bitcoin’s price has remained stable.

The market is watching Tesla’s upcoming third-quarter financial results, which are due to be released on October 23, for more clarity on its Bitcoin strategy.

Tesla is currently the fourth-largest Bitcoin holder among publicly traded companies, behind MicroStrategy, Marathon Digital, and Riot Platforms. If Tesla does decide to sell its Bitcoin, the market could see increased volatility, as a sale of this size would immediately impact Bitcoin’s price.