Why Tesla’s $2 Billion In Bitcoin Is A Distraction And Circus, According To One Analyst

• Tesla’s stock is up today, although the stock is down 9% so far this year. Bitcoin is also trading higher today, but it has lost 8% of its value since the beginning of 2022.

• In terms of vehicles sold in the quarter, Tesla had roughly 309,000, which would have been about 35,000 more if not for a chip shortfall. So, right now, there’s about a 10% to 15% headwind in terms of where the numbers may genuinely be.

• A $5 trillion market opportunity in terms of electric vehicles, and it’s the biggest change in the car business since the 1950s, Ives told Yahoo Finance last month.

Tesla now takes Dogecoin for select items on its website, and Musk, a famous crypto phile, has professed his passion for other cryptocurrencies like Dogecoin. In a regulatory filing last year, Tesla also gave CFO Zach Kirkhorn the title of Master of Coin, apparently in reference to the company’s bitcoin holdings.

A $5 Trillion Market Opportunity

While Tesla’s backing of cryptocurrencies in general may be something the firm believes will be the future of currency and transacting, some are concerned that its obsession with cryptocurrency may cause it to lose sight of what is happening in the EV industry. Despite the volatility and investor concerns, Tesla is doubling down on its Bitcoin approach, according to Wedbush analyst Dan Ives of Yahoo Finance. During this risk-off backdrop, They believe it remains a distraction and sideshow from the underlying Tesla storey.

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For Ives, this sentiment is nothing new. In a research paper on Tesla’s interest on Bitcoin and backtracking on using it as payment in May of 2021, Ives expressed a similar tone: Not accepting Bitcoin does not change Tesla’s thesis or growth trajectory, but it does add to the noise and volatility surrounding the company at a time when risk assets are under intense selling pressure on Wall Street, with Tesla leading the push. What concerns Ives and many other Tesla analysts, such as Morgan Stanley’s Adam Jonas, is the ‘green tidal wave,’ or the enormous transition of the car industry from an Motors, inverters, and batteries will be used to convert the ICE (internal combustion engine) powertrain structure to fully electric.

They’re seeing a $5 trillion market opportunity in terms of electric vehicles, and it’s the biggest change in the car business since the 1950s, Ives told Yahoo Finance last month. Ives is more concerned about how Tesla can get additional cars into the hands of potential purchasers, which he argues is the company’s fundamental difficulty.

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They’re Having A Supply Problem

In terms of vehicles sold in the quarter, Tesla had roughly 309,000, which would have been about 35,000 more if not for a chip shortfall. So, right now, there’s about a 10% to 15% headwind in terms of where the numbers may genuinely be, says the analyst. Following Tesla’s Q4 earnings release, Ives told Yahoo Finance. They don’t have a demand problem; they have a supply problem, which I see as a high-class issue. And that’s something Musk should discuss, he adds.

Ives’ advice to Musk & Co, as he likes to refer to them, is simple: Focus on the supply problem rather than the distraction of bitcoin and crypto. But, as many pundits, fans, and detractors have pointed out in the past, telling Elon Musk what to do is nearly impossible. Tesla’s stock is up today, although the stock is down 9% so far this year. Bitcoin is also trading higher today, but it has lost 8% of its value since the beginning of 2022.