Reportedly, SpaceX reduced the value of its Bitcoin by a total of $373 million and potentially liquidated all of its holdings.
The Elon Musk-led firm bounces back from 2021 and 2021 annual losses, reportedly achieving a slight Q1 2023 profit.
SpaceX Financial Statements Raise Questions About Bitcoin Holdings
The Wall Street Journal’s report on Aug. 17, which looked at the company’s financial statements, leaves uncertainty if SpaceX actually sold all of its Bitcoin:
“SpaceX wrote down the value of bitcoin it owns by a total of $373 million last year and in 2021 and has sold the cryptocurrency.”
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However, Big Four Accounting Firm Deloitte declares that, typically the accounting treatment for Bitcoin involves considering it as an “indefinite-lived intangible asset.” It states to account for Bitcoin at cost and then make adjustments if the price decreases.
Should the value of Bitcoin decline or become impaired, the company must report a write-down in its books.
After recording a decrease, the asset’s value on the balance sheet cannot be “written up.” This rule applies to any subsequent Bitcoin price increase or rebound.
Bitcoin Is Not Musk’s Favorite Crypto
While Musk’s company might possess substantial holdings in Bitcoin, he often alludes to Dogecoin as his favored crypto.
On May 24, Musk voiced his preference for Dogecoin as his favorite crypto, simply because it “has the best humor and it has dogs.”
Musk made it clear that he did not intend to provide any financial advice:
“I’m not advising anyone to buy crypto or bet the farm on Dogecoin or anything like that” he states.