Here’s how Tesla’s 11,509 Bitcoin holdings affected Q4 profits

Tesla’s Bitcoin holdings surged by $600 million, reflecting new accounting rule benefits.
Tesla’s net income growth highlights strong financial resilience.

Tesla’s latest earnings report highlights a significant boost from its Bitcoin [BTC] holdings, reflecting the impact of a new accounting rule that allows companies to adjust digital asset valuations based on market prices each quarter.

In Q4 2024, the electric vehicle giant reported a $600 million gain on its BTC reserves, with its total holdings standing at 11,509 BTC, valued at approximately $1.19 billion, according to Arkham Intelligence.

This marks a substantial increase from the previously recorded $184 million, underscoring Bitcoin’s growing influence on Tesla’s financial strategy.

Impact of the new FASB rule

For those unaware, the new Financial Accounting Standards Board (FASB) rule implemented in December 2023 has reshaped how corporations report their cryptocurrency holdings.

Under this change, companies can now reflect the fair market value of digital assets on their balance sheets. This aligns reported valuations with real-time market conditions.

Previously, firms had to record impairment losses when crypto prices declined. They couldn’t adjust valuations upward unless they sold the assets, often leading to undervalued financial statements.

As expected, Tesla benefited significantly from this revision. Tesla reported a Generally Accepted Accounting Principles (GAAP) income of $2.3 billion in Q4 2024, with $600 million attributed to gains from its BTC holdings.