Bitcoin prices have established and continued to test a technical support level of $30,000 since January of this year.
In a Bloomberg article, the importance of large companies reporting previously accepted cryptocurrencies is discussed.
According to the publication, Tesla and MicroStrategy had previously announced the acceptance of Bitcoin as a payment method. Square is also on this list.
It’s time for Bitcoin’s corporate champions to account for a brutal selloff in the cryptocurrency https://t.co/QEq8HCAFLG
— Bloomberg (@business) July 26, 2021
MicroStrategy’s and Tesla’s current situation
MicroStrategy has made Bitcoin a central part of its entire business. The situation worsened to the point where the company had to sell bonds in order to make purchases. CEO Michael Saylor personally oversaw the process, which cost the company just over $2.25 billion.
On the other hand, Tesla made a profit of $128 million from the sale of tokens, according to the company’s first-quarter report. This step was taken, according to Elon Musk, to demonstrate the first cryptocurrency’s liquidity.
During the online Conference with ARK’s Cathie Wood and ARK Bitcoin CEO Jack Dorsey, Elon Musk commented on Tesla and Bitcoin during the B-Word online conference, pushing up the stock price of the company.
2/ $TSLA still lagging its normal pre-earnings gain (-3.5% since Vol Day, +25.7% normal gain past 6 qtrs). This likely reflects uncertainty about 2Q ZEV credits and ~$80M #btc impairment charge. The latter will be noise investors will look past. My 2Q EPS is $1.10 vs Street $.96. pic.twitter.com/s1z41otEaC
— Gary Black (@garyblack00) July 22, 2021
Despite this, Tesla’s stock price dropped in the second quarter as a result of inaccurate predictions about the state of the electric car market. The company’s intervention on Bitcoin, according to some Wall Street analysts, may have also played a role.
Now, according to Bloomberg, it’s time for these companies with cryptocurrency assets to report on them. Tesla and MicroStrategy will go through the process next week.
In August, Square, on the other hand, will report. This event drew the attention of experts as well. Price volatility, according to accounting analyst and R.G. Associates founder Jack Kesielski, will have an impact this quarter.
Bloomberg also points out that the price of Bitcoin fell 41% in the second quarter of 2021, according to Bloomberg.
However, firms are more likely to take write-downs as a result of this information being made public. Businesses can still make significant profits if they previously sold digital currencies for more than they paid for them.
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