Last week Elon Musk announced on Twitter that his electric vehicle maker company Tesla would no longer support bitcoin payments because of environmental concerns. The news caused bitcoin to slump immediately, and the entire crypto cap lost $500 billion in a day. As of writing, Bitcoin prices had lost 10% on the day and were trading at $42,600. Ironically this is very close to the price BTC hit after Tesla announced its $1.5 billion purchase of bitcoin in February.
Elon Musk’s tweets cause bitcoin’s price to slump.
Since its all-time high on April 14, the leading cryptocurrency bitcoin has corrected 35% making this the fifth and largest correction of the current market cycle. Things are now in danger of heading into a full bear market if BTC fails to hold above $40K. The fall in the price of bitcoin may have been instigated by one man and the implication that his company may have sold its BTC holdings. Earlier, an anonymous crypto commentator ‘CryptoWhale’ suggested that Tesla had sold its Bitcoin holdings, to which Elon Musk simply replied, “indeed.”
Elon Musk’s massive u-turn on bitcoin
Hitherto Elon Musk had been one of the most influential tech billionaires to get his support behind cryptocurrencies, especially bitcoin. Earlier this year, Tesla’s decision to add bitcoin to its balance sheet got him raved by the crypto community and making the decentralized cryptocurrency more mainstream. However, his u-turn has left the crypto market bewildered. In a recent Twitter spat with crypto enthusiasts, Elon Musk said that bitcoin is “highly centralized” and most of it is controlled by “big mining companies.” Later Tesla CEO clarified that speculations of Tesla selling its bitcoin holdings are not true, and the company continues to hold its massive bitcoin holdings.