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Elon Musk Flip-Flops over selling BTC, causes Bitcoin crash

Botsfolio

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24 May, 2021

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Bitcoin fell to a three-month low early Monday on a one-word tweet from Elon Musk.

tweet screenshot

There were rumors and suggestions that the electric vehicle manufacturing company Tesla, had sold off its bitcoin holdings. The speculations came after @CryptoWhale made a suggestive tweet hinting that Tesla would have dumped its bitcoin holdings this second quarter. Musk replied, "Indeed."

However, the community did not react well to the Tesla CEO’s response, with many saying that Musk should sell all his bitcoins and not get involved with crypto again. Most of the commenters stated that the billionaire did not understand bitcoin and it was better if he was not involved in the crypto space.

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Meanwhile, BTC price reacted to the announcement, dropping below $52,000 in minutes, and further tumbled to $43,000.

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The market then started to recover when Musk posted a reply to a tweet noting that his prior tweet had caused the market to drop. Musk confirmed that Tesla had not sold any further Bitcoin since their Q1 earnings report.

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Bitcoin and other crypto assets have looked volatile over the last few days, since Musk revealed that Tesla would be suspending bitcoin payments for its vehicles. The announcement came after the electric vehicle manufacturer announced that it was accepting bitcoin as a payment method back in March. The company earlier bought $1.5 billion worth of BTC.

Musk, stating the reason for the suspension, said that the company was concerned about the amount of electricity used to mine bitcoin.

BTC is down 22% in the last 24 hours, trading at $43K at the time of writing. It’s not the only asset that’s suffered: various other coins including ETH (-14%), UNI (-2.9%) are also in the red.

Favoring Doge

Musk has been a long-time supporter of dogecoin, with DOGE’s price performance largely based on the Tesla CEO’s tweet. Hours before Musk’s debut SNL hosting on May 8, he called for caution when investing in crypto.

Few days before suspending BTC payments, Musk carried out a poll via Twitter, asking if Tesla should accept dogecoin. The results saw overwhelming support for DOGE, with 78% out of almost 4 million votes agreeing to Tesla adding DOGE payment.

Recently, Musk’s rocket company SpaceX accepted dogecoin payment to launch DOGE-1 mission to the Moon in 2022.

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