Bitcoin Price Drops as Musk Slams the Coin and Its Followers

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Created by TradeOr

3rd Party Analysis 17 May 2021

Key Takeaways

  • Cryptocurrencies take a hit after Elon Musk bashes Bitcoin
  • A series of Musk tweets criticizing Bitcoin pressured its price to $42,000

Bitcoin Price Drops as Musk Slams the Coin

The price of Bitcoin has been spiraling down for the past six days straight. The selling momentum intensified in the early Monday hours when Elon Musk, once the most influential and vocal supporter of Bitcoin, went even further in his criticism toward the digital asset.

The Tesla and SpaceX CEO renewed his confrontation with Bitcoin supporters on Twitter earlier today. Mr. Musk blasted Bitcoin by saying the crypto asset “is actually highly centralized, with supermajority controlled by handful of big mining (aka hashing) companies.” “A single coal mine in Xinjiang flooded, almost killing miners, and Bitcoin hash rate dropped 35%. Sound “decentralized” to you,” he concluded.

Adding to the downside momentum, Elon Musk confronted Bitcoin advocates who say that proof-of-work mining helps decentralize the network. “Hey cryptocurrency “experts”, ever heard of PayPal? It’s possible… maybe… that I know [more] than you realize about how money works” said Elon Musk, who co-founded PayPal.

Elon Musk added more fuel to the fire by implying that Tesla might have sold its Bitcoins, which was later dismissed. A tweet suggested that “Bitcoiners are going to slap themselves next quarter when they find out Tesla dumped the rest of their Bitcoin holdings.” In response, Elon Musk commented “Indeed.” A follow-up tweet, however, reassured the Crypto Twitter that “Tesla has not sold any Bitcoin”.

Battered by Elon Musk’s bashing comments, Bitcoin slipped to a low near $42,000, a level last seen in early February. Bitcoin’s decline extends to a sixth straight day on Monday as crypto market participants are trying to make sense of Mr. Musk’s power to move billions of dollars in the unregulated and highly-volatile digital asset space.

Presently, Bitcoin witnessed a slight move to the upside that lifted the price around $45,000 per coin. Other cryptocurrencies also suffered a blow. Ether dropped to a low of $3,100, while Dogecoin declined to $0.46.

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