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Bitcoin falls to three-month low on Musk selling hint

By Neil Dennis

06:20, 17 May 2021

A bitcoin token sits on a pile of pennies

Bitcoin hit a three-month low on Monday morning after a sell-off was prompted over the weekend by further suggestions that cryptocurreny guru Elon Musk was falling out of love with the asset class.

There may even have been a hint that the Tesla founder was selling bitcoin in the wake of his decision last week to stop accepting the world’s biggest cryptocurrency in payment for his electric vehicles, but Musk later denied Tesla had recently sold any of its holdings.

The latest move was sparked after a commentator on Twitter known as @CryptoWhale posted a tweet that said: “Bitcoiners are going to slap themselves next quarter when they find out Tesla dumped the rest of their #Bitcoin holdings. With the amount of hate @elonmusk is getting, I wouldn’t blame him.”

To this, Musk simply replied: “Indeed.”

However, on Monday morning, Musk took to his Twitter feed again to add some clarity to the confusion:

“To clarify speculation, Tesla has not sold any Bitcoin.”

Role as influencer

Musk’s influence among cryptocurrency investors cannot be underestimated. They hang on his every word to get some idea of his thoughts about his next move in the market.

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His company Tesla bought $1.5bn in bitcoin this year – selling down around 10% during the first quarter, the company results revealed last month.

“Tesla chief executive Elon Musk has been a large proponent of cryptocurrencies, helping the bitcoin price rally, and other digital currencies including dogecoin in the past year,” said Sarah Tran, analyst at FXStreet.

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Bitcoin value tumbles

Bitcoin prices fell by around 17% on Thursday 13 May to $46,000 after Musk said Tesla would no longer accept bitcoin as payment for its vehicles over concerns about the increasingly energy intensive way in which the cryptocurrency is mined.

Following his reply to @CryptoWhale’s tweet on Sunday, bitcoin fell a further 8.2% to a three month low of $42,208. After Musk denied Tesla had sold any bitcion, the price recovered a little to $44,871.

There were some heavy losses elsewhere among the cryptocurrency top 10. Dog-memed dogecoin – another of Musk’s pet projects – was down 7.6% at $0.488.

Ethereum, which also fell sharply at the end of last week after Vitalik Buterin – co-founder of the second-biggest crytpocurrency – moved $2bn worth out of his main public address, fell a further 10% on Monday to $3,403.

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Read more: Musk bans Bitcoin Tesla vehicle purchases

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