Nicknamed the “real-life Iron Man” and capable of revolutionizing everything he touches – from electric cars to rockets to social media – Elon Musk keeps the world watching his every move. But even geniuses make mistakes. And this time, it cost… $5 billion.

Bitcoin Gamble

In early 2021, in the context of a vibrant global financial market thanks to loose monetary policy and confidence in digital assets, Tesla suddenly announced a $1.5 billion investment in Bitcoin.

Elon Musk did not hide his expectations for this digital currency when he said that Bitcoin is the “future”, a way for Tesla to diversify its cash flow and catch the new financial wave.

At that time, Musk frequently expressed his support for Bitcoin on Twitter (now X), and even adding #bitcoin to his personal bio was enough to cause Bitcoin’s price to skyrocket 20% in just one day. Investors flocked to Musk like the leader of the times.

However, just over a year later, amid environmental concerns, inflationary pressures and a market crash, Tesla sold 75% of its Bitcoin holdings in mid-2022, when the price of the digital currency was plunging, in order to shore up its balance sheet with cash.

This seemed like a prudent decision at the time, as Tesla also lost about two-thirds of its market capitalization and Bitcoin fell 60% in 2022.

The decision netted Tesla $936 million in short-term cash, but turned out to be an opportunity loss in the long term as Bitcoin rose unexpectedly if it waited two more years. The decision, made in mid-2022, has become an unfortunate blip on Tesla’s portfolio, especially as Bitcoin is flying near record highs.

In the wake of Tesla’s disappointing second-quarter earnings report—revenue and profit both below Wall Street expectations, and the company’s stock falling sharply—the Bitcoin story has become even more prominent. Tesla’s digital asset is now worth $1.24 billion, a growth figure that also contains a huge amount of regret.

Ironically, after that difficult period, Bitcoin made a spectacular comeback. The cryptocurrency has recovered strongly, further boosted by regulatory easing and the proposal to create a strategic Bitcoin reserve.

Bitcoin is currently trading at a record high, up about six times from the end of Q2 2022, when Tesla “exited”, at more than $119,000.

If the entire amount of Bitcoin purchased from the beginning was kept, Tesla’s estimated digital asset value could now be up to nearly $5 billion, instead of the current $1.24 billion.

In other words, Elon Musk has missed out on at least $3.5 billion in potential profits, a staggering figure even for a company worth hundreds of billions like Tesla, especially in the context of a weakening electric vehicle business, falling revenue, eroded profits and a stock that has lost nearly 25% since the beginning of the year.

Interestingly, while the cryptocurrency market has been on a strong recovery since early 2024 – thanks to expectations of easing policies and even US President Donald Trump’s promise of a “national Bitcoin reserve”, Elon Musk has been largely silent.

Over the past three years, he hasn’t mentioned Bitcoin on X as frequently as he used to. No more fiery tweets, no more jokes about Dogecoin.

Is it a personal disappointment? Or is Elon Musk simply busy with other bets – like the Optimus humanoid robot, self-driving taxi services, and AI on X?

Out of money?

CNBC news agency commented that although Elon Musk has repeatedly affirmed that Tesla’s future lies in robotaxi and humanoid robots (Optimus) rather than cryptocurrency investments, Tesla’s current business reality is facing many difficulties.

Auto sales fell for a second straight quarter, and the company is facing “big, expensive bets” in competitive markets. The extra cash from Bitcoin may have come in handy.

Bitcoin profits contributed $284 million to Tesla’s $1.17 billion net income in the second quarter, but the figure could have been much larger, significantly boosting the company’s bottom line during a challenging period.

Some experts say that Elon Musk no longer has enough capital to participate in the cryptocurrency market.

Since Tesla sold Bitcoin, Elon Musk has barely mentioned the currency on social media. His last notable statement about the cryptocurrency was in March 2022, just before Tesla began selling Bitcoin, when he wrote: “I still own and will not sell my Bitcoin, Ethereum, or Doge.” A statement that now carries a completely different meaning.

Obviously, no one is always right in investing, even the smartest people. Therefore, the case of Elon Musk is a clear proof that the time to buy and especially the time to sell is the time when investors’ vision is most challenged.

For Tesla, selling Bitcoin in 2022 was once seen as a sensible defensive move. But looking back from 2025, it is clearly a missed opportunity that cost billions of dollars.

In investing, it’s not just mistakes that cost you money. Sometimes, it’s fear, haste, and impatience that can cost you dearly. And this time, Elon Musk is no exception.