Once again, Elon Musk speaks and Bitcoin investors listen. This time the result is a major sell-off of Bitcoin. According to CNBC:
“Tesla CEO Elon Musk said Wednesday on Twitter that Tesla has ‘suspended vehicle purchases using bitcoin,” out of concern over “rapidly increasing use of fossil fuels for bitcoin mining’…. In an SEC filing in February, Tesla revealed that it bought $1.5 billion worth of bitcoin and it may invest in more of bitcoin or other crypto currencies in the future.”
This sell-off may very well continue, perhaps offering investors an opportunity to get a position much lower than was previously believed possible. I guess if that is the case, we will have to wonder where the bottom will be. Or, perhaps it has already hit bottom. As of the publication of this article, BTC was a bit over 48,500, up from 46,000 earlier this evening.
For the last couple of months, people have been talking about Bitcoin’s new bottom, or resistance level. Perhaps this will be yet another short-term dip. Bitcoin has proven itself to be very strong over the past few months, rising and falling on economic news, yet not free falling like it did in 2017.
The question some are raising is this: Is Elon Musk, who creates vehicles that are friendlier to the environment, is he using his influence to leverage changes in the crypto world? That would make sense. However, another question comes to my mind, “Is this simply a smokescreen for something else”?
My gut feeling, which probably isn’t worth much, is with the former question. Even if his concern is more business than ethical, to run a massive company on a principle requires consistency within that company’s overall mission. I suppose we shall wait and see what happens next.
As always, buy, sell, and trade at your own risk.
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