Tesla did something big on Wednesday, moving its Bitcoin reserves, the first time in more than two years, and many Bitcoin traders were stunned. However, so far, these Bitcoins have not been put into trading wallets or exchanged for stablecoins, so everyone can wait and see.
Why did Tesla move these digital assets?
Tesla, controlled by Elon Musk, moved more than $750 million worth of Bitcoin to a new wallet earlier this week. This is the first major move of Bitcoin after nearly two years of dormancy, and the market is in an uproar.
This wave of operations has made everyone start to wonder what Tesla and Musk are up to, and whether it will trigger a new round of selling pressure.
According to BitcoinTreasuries, Tesla held about 10,000 Bitcoins before the move, ranking fourth among corporate holders. Tesla has increased its holdings a lot in 2021, but it also sold a lot in the bear market in 2022.
Data from Arkham Intelligence on Wednesday showed that the bitcoins were transferred to new wallets rather than exchanges, which temporarily put everyone's concerns about the sell-off to rest. Tesla and Musk have not yet commented on the matter, but more details may be revealed when the company announces third-quarter earnings results early next week.
Maartunn, an analyst at the CryptoQuant community, said in an interview on Thursday that the reasons are still speculation, ranging from wallet management to asset restructuring.
For example, Tesla may have moved the bitcoins to fulfill accounting or legal obligations for compliance or internal audits.
Another possibility is wallet management. Tesla may use multiple wallets for operational convenience. But this possibility is not very likely because the newly created addresses all use similar Pay-to-PubKey-Hash (P2PKH) addresses.