Tesla & More bet on Bitcoin and lost billions – Are your investments safe?

It is true we live in dangerous economic times. The most astute traders will continue to make money, but even experienced investors have a hard time navigating these tough economic seas.

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Losses occur, but the companies that have suffered large crypto losses take it on the chin. As Blockworks reports, three industry leaders and heavy crypto investors – Elon Musk (Tesla, Inc.), Jack Dorsey (Block, formerly Square inc.) And Michael Saylor (MicroStrategy LLC) – have seen companies’ balances beaten and their collective losses in bitcoin falling to over $ 2 billion.

After acquiring 43,200 BTC worth $ 1.5 billion in February 2021, Musk’s Tesla had a bitcoin nest worth around $ 844 million in the first quarter of 2022. The total now shows a loss of around $ 655 million, a decrease of 45% in bitcoin purchases.

Dorsey’s Block owned 8,027 bitcoin in mid-June at an average cost of $ 27,407 for a total of $ 220 million. His estimated unrealized losses amount to $ 63 million per Blockworks.

And according to Bitcoinist, Saylor’s software development company MicroStrategy has spent around $ 4 billion and has amassed nearly 130,000 BTCs in the last two years. As of mid-June, MicroStrategy was valued at $ 3 billion, but its bitcoin-related paper losses amounted to about $ 1 billion, per Bloomberg.

Although Tesla and MicroStrategy together account for almost 78% of all Bitcoin owned by listed companies, the three companies together are down $ 2.16 billion on bitcoin investments. The total crypto market that was estimated to be worth $ 3 trillion six months ago is now worth less than $ 1 trillion, according to The Guardian.

These three are not the only companies that have had significant unrealized losses. The cryptocurrency exchange platform Coinbase (owners of 4,483 bitcoin) has lost market share at an accelerating pace, and the South Korean-Japanese video game publisher Nexon (1,717 bitcoin) partly blamed the loss of 4.1 billion dollars in August 2021 on bitcoin volatility, per Currency.com.

However, those close to the seemingly endless highs and lows of cryptocurrencies do not seem overly concerned. Despite ongoing crypto-unpredictability, there is unshakable optimism among those who invest in it. Kim Grauer, head of research at Chainalysis, said: “Crypto does not disappear. And it has experienced crashes that are more serious than this crash,” according to The Guardian.

Nexon, which invested $ 100 million just before the fall of Bitcoin in April 2021, will continue to invest in crypto. “In the current economic environment, we believe Bitcoin offers long-term stability and liquidity while maintaining the value of our cash for future investments,” Nexon CEO Owen Mahoney said in a statement announcing the company’s Bitcoin investment.

Resolute determination is fine for those who can carry their companies through volatile price fluctuations, but what should the average investor do in economically turbulent times like these? As TIME’s Next Advisor recommends, it’s a good start to keep your crypto investments in check and not tie too much of your portfolio to it (below 5%).

“You have a great chance of losing everything, but a small chance of winning it big,” said Modern Money Management CFP Nate Nieri. “Do not play an amount that will burden your family or prevent you from reaching your goals.”

See: When will the next Crypto Bull Market begin?
Find: 8 best cryptocurrencies to invest in for 2022

It will be interesting to see how long the larger companies last. As Bloomberg reported, at a Bitcoin 2021 conference in Miami, Dorsey stated, “Bitcoin is changing absolutely everything. I do not think there is anything more important in my life to work with.”

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