Last week it looked like there was no stopping bitcoin as the world's first cryptocurrency surged past the $58,000-mark. However, a tweet from Elon Musk, raising concerns over the prices of Bitcoin, which appeared to be "too high" to him, sent the currency spiraling nearly 16% and the digital currency was down below $50,000 in New York on Monday.
Although some suggest that Musk's opinion could be one of the reasons behind bitcoin's crash, many claim that adding the billionaire's views on micro-blogging site may not be the only reason for the fall. Not to forget, the cryptocurrency continued to rally even after Musk's tweet and reached its all-time high.
That said, BTC & ETH do seem high lol— Elon Musk (@elonmusk) February 20, 2021
This massive fall in the prices of Bitcoin — after having largely shown the upward trajectory — comes just two weeks after Tesla revealed that it had invested $1.5 billion in the cryptocurrency and was planning to start accepting it as a mode of payment. The news led bitcoin skyrocket past the $50,000-mark.
On Sunday, it surpassed $58,000 per unit, almost double the $29,000 of its cost on January 27, which has been its lowest price so far this year. It had hit a market capitalisation of $1 trillion last week, Reuters reported. Bitcoins gains have been attributed to signs it is gaining acceptance among mainstream investors and companies such as Tesla, Mastercard and BNY Mellon.
Nonetheless, in his tweet, Musk referred to bitcoin rival ethereum, which gave up 8.7 percent, closing at $1,765. However, it wasn't just Bitcoin that suffered the most.
Meanwhile, Tesla's prices too tumbled, plunging first by as much as 9.1 percent, according to Bloomberg, before closing down at 8.6 percent.
There were larger consequences of Musk's tweet. The 8.6 percent fall in Tesla's share price and wiped out a staggering $15.2 billion from Musk's net worth, meaning he was no longer the world's richest man, Bloomberg reported.
Musk conceded his spot on the "Bloomberg Billionaire Index" to Amazon founder Jeff Bezos.