Binance founder and CEO Changpeng Zhao (with a net worth of $27.3 billion as of July 21) shared his views on Tesla Inc TSLA unloads most of it Bitcoin BTC/USD inventory.
In a recent interview, Zhao said people shouldn’t read too deeply into it Elon Musk cashing out of Bitcoin so heavily.
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“He’s a smart guy, but that doesn’t mean he has every valuable asset in the world. For example, he probably doesn’t have many other company stocks, many other valuable cryptocurrencies, etc.,” Zhao said.
He added that just because Musk buys and sells some Bitcoin, it does not reflect its underlying value. And Musk’s acceptance of Bitcoin didn’t make it any better, and just because he sold Bitcoin didn’t make it any worse.
“The fundamentals of Bitcoin didn’t change because a guy bought or sold. No one knows the reasons why Musk bought it or sold it. Maybe he needed money for Tesla or tried to buy Twitter or something else – I don’t know. But it means not so much,” he said.
Last week, Tesla mentioned that it had liquidated about 75% of its Bitcoin holdings to add $936 million to the EV giant’s balance sheet in the second quarter.
Musk said he sold Tesla’s Bitcoin as a hedge against the macroeconomic and geopolitical uncertainty facing global markets.
“The reason we sold a bunch of our Bitcoin holdings was because we were unsure when the COVID lockdowns in China would ease,” Musk said.
Tesla bought $1.5 billion in Bitcoin in January 2021. In the first quarter of 2021, Tesla sold $272 million of the cryptocurrency and said it had a “positive impact” of $101 million on profitability.
Tesla ended the first quarter of 2022 with $1.26 billion in Bitcoin on its balance sheet.
Photo courtesy: Binance and NVIDIA Corporation on Flickr