Musk’s moves and comments about bitcoin withdrawal keep coming.
Following Musk’s surprise announcement last week that Tesla was halting Bitcoin payments for cars due to the highly polluting nature of the Bitcoin process from mining to trading, on Sunday, a netizen predicted that “the former will be extremely remorseful when Bitcoin investors perceive that Tesla is dumping its Bitcoin holdings in the next quarter,” and Musk gave another Musk responded in the affirmative.
The response instantly ignited a frayed nerve in the cryptocurrency, and the already downward spiral of bitcoin accelerated its precipitous decline, with the price falling below $43,000 per coin at one point, down more than $6,000 from its intraday high, and sliding all the way to its lowest level since February of this year. While bitcoin prices have rebounded with subsequent clarifications from Musk, they have evaporated by about $20,000 compared to the $60,000 per coin peak in April.
As of 20:03 GMT on May 17, the bitcoin price stood at $45,661.75, down 7.11% in 24 hours.
Musk ambiguously in and out of dogcoin and bitcoin
The market for cryptocurrencies such as bitcoin has been extremely “bright” in the last week.
“Bitcoin investors will be extremely remorseful when they realize that Tesla is dumping its bitcoin holdings in the next quarter.”
A user with the account “cryptowhale” said on social media on May 16 local time.
This seemingly uneventful message would not have stood out among the many comments made by Musk’s group of bitcoin supporters last week, but after Musk’s “yes” response, the market exploded.
Bitcoin, which has always been under Musk’s sway, then increased its declining trend, falling below $45,000 for the first time in nearly three months, and sliding all the way below $45,000 and $44,000 in quick succession to set the lowest price record since February this year, a drop of about 8%.
By May 17, Musk again issued remarks to clarify, “Tesla did not sell any bitcoin as a clarification.”
As a result, Bitcoin temporarily stabilized its decline.
This volatility came just after Tesla’s sudden change in attitude toward bitcoin.
On May 12, local time, Musk said Tesla would suspend Bitcoin payments for car purchases due to concerns about the significant use of fossil fuels, especially coal energy, in the Bitcoin mining-to-trading process. The original statement was, “We think cryptocurrency is extremely promising in many ways, but that doesn’t come at the cost of polluting the environment. Tesla will also not sell any bitcoin, and will only restart bitcoin trading after it has switched to a more environmentally friendly approach, in the meantime we are looking for other cryptocurrencies that consume less than 1% of bitcoin’s energy.”
As expected, the price of bitcoin immediately jumped, plunging to near $50,000 per unit, a drop of 11%. The decline has continued to this day, during which time it touched below $43,000 per coin.
Underneath the above set of psychedelic operations is Musk’s flip-flopping attitude towards dogcoin, changing the flag.
On May 8, local time, Musk made his debut on Saturday Night Live to “popularize” the “dogcoin” and the principle behind it, but after the host “So is this a scam?” After the host’s rhetorical question, the former suddenly admitted, “Yes, I think it’s a scam.”
Dogcoin, which once surged to a price of $0.7376 per coin, turned sharply down, dropping all the way to $0.41 from an intra-day high of $0.72, a drop of 24.85% in 24 hours. The dogcoin clusters simply panicked and went to Musk’s account to leave messages, expecting to get another boost from Musk. Shortly after the late-night show, SpaceX was the first to say it would accept dogcoin as an exclusive payment method for the launch of the lunar satellite DOGE-1. Musk then took advantage of the heat to hold an online public poll on “whether you want to buy a Tesla with dogcoin”, in which more than 2.5 million fans participated. 77% said they would like to pay for the Tesla with dogcoins. Two consecutive rounds of operations have boosted the price of dogcoin, which is currently hovering in the range of 0.496-0.502.
And to add to the nerves of dogcoin fans, just one day after Tesla announced that it was discontinuing its bitcoin payment method, Musk claimed that it was working with Doge developers to make transactions more efficient.
Virtual Coin Trends Explained
Speaking to 21st Century Business Herald, Tony Sycamore, a senior analyst at the Carlson Group, explained that for novice investors, bitcoin is hardly likely to see a thousandfold spike. As a result, cottage coins such as dogcoin may be the next anchor. Recently, investors have been selling their bitcoins and trading into “cryptocurrency’s oldest”, ethereum, and dogcoin is also a popular choice.
According to Tony Sycamore, “Bitcoin’s dominance will be hard to shake. The cryptocurrency market is currently in a bullish phase, so various cryptocurrencies are generally rising, which in turn is lowering Bitcoin’s market share.
In an interview with the 21st Century Business Herald, Yu Jianing, the rotating chairman of the Blockchain Special Committee of the China Communications Industry Association and president of Firecoin University, pointed out that Bitcoin has cooled down to a certain extent given that the short-term Bitcoin price has risen sharply, while the accompanying “animal coin” boom has led to a certain degree of market bubble.
“The market is currently in a standstill phase between traditional institutions allocating crypto assets, Coinbase’s positive listing and the Fed’s wavering on interest rate hikes, and the impact of Musk’s personal influence on bitcoin and animal coins such as dog coins. “, Yu Jianing said, “but in the medium to long term, the current crypto asset market is probably at the stage corresponding to July and August 2017, where outsiders have not yet entered on a large scale. It was only in May this year that the market was considered to have entered a real bull market, with off-site funds continuously entering and market sentiment extremely exuberant, but at the same time, there was a serious divergence in judgment and selection of assets across the market. Therefore, the next few months will likely be the midway point of the bull market, with Bitcoin and other mainstream assets still having room to continue to move upward, but only a small number of emerging assets will be able to weather the bulls and bears and become valuable assets going forward.”
Could Musk be suspected of market manipulation?
Obviously, behind Musk’s repeated and seemingly “spur-of-the-moment” comments on the virtual currency market, is it really “not surprising that someone like me, who could put SpaceX on the moon, would talk like that” as he explained, or is there some other Are there any artificial considerations? Did Tesla sell all of its remaining bitcoins? And did Musk do anything with his own bitcoin holdings?
Back on April 26th, Tesla Inc. released its quarterly earnings report showing that it purchased $1.2 billion in bitcoin in the first quarter and made $101 million from the sale of bitcoin. In the earnings call, Tesla CFO Zachary Kirkhorn even reiterated his belief in the long-term value of bitcoin and stuck to his commitment as a payment method.
And in just over half a month, Musk launched another short-selling statement about Bitcoin’s high polluting nature. Musk, who is good at technology and has long been active in the cryptocurrency space, should also have only recently become suddenly aware of the pollution caused by Bitcoin. If not, why did he start out “vowing” to do so?
But so far, there has been no news about Musk’s personal bitcoin holdings.
Yu Jianing believes that the reason Musk can have such a big impact on crypto assets like bitcoin and dogcoin through himself is because of the crypto asset market’s longstanding desire to integrate into mainstream finance. “Whether it’s Musk, or traditional financial capital representatives like Warren Buffett, Charlie Munger, or Bill Gates, their views on Bitcoin will have an impact on the overall confidence of the market. In contrast to Warren Buffett, Charlie Munger or Bill Gates, their attitudes towards bitcoin have not seen a major shift and investors have psychological expectations. Only Musk has been promoting Bitcoin and Dogcoin day in and day out on social media since this year, using his status as a social networker to assign value to Bitcoin and Dogcoin, driving retail investors who follow him to invest and even catch up.”
But the further question is, as the SEC tightens cryptocurrency regulation, can his completely contradictory statements under the SEC’s watch be categorized as market manipulation?
The SEC defines market manipulation as an intentional act of deception in which investors are deceived by controlling or artificially influencing prices; or intentionally interfering with the free supply and demand of the market so as to artificially direct stock price movements. Market manipulation usually takes the form of pump and dump and hype and dump.
A lawyer told 21st Century Business Herald that market manipulation is unique to the securities market, and bitcoin is not a security-based token. Under existing regulations, Musk is not currently subject to SEC regulatory rules because the cryptocurrency sector is not currently subject to SEC regulatory rules.
“I think a professional body should step in and investigate whether he had the intent to manipulate the market and was able to actually profit in this way. If a future agency finds evidence that Musk intentionally manipulated the market and profited, Musk will likely be punished by U.S. securities regulators. There is a precedent of a star figure in the US being punished for ‘calling the shots’ for certain crypto assets.” Yu Jianing said.
Matt Weller, head of global research at Goldman Sachs, told 21st Century Business Herald that for Musk to go long on cryptocurrencies on one side could be targeted by regulation. “Musk was invited to ‘tea’ by regulation after he sang about dogcoin, and at one point also deactivated his social media, from which Musk began to converge. The bottom line is that at this stage of development, Musk needs to be concerned about what large institutional investors think, and the hype about bitcoin is turning off many institutions.”
Matt Weller also believes that “Tesla’s high ESG rating is fueled by the ‘clean tech opportunity’ item, and perhaps Musk doesn’t want Bitcoin to hold it back today. Technically, Tesla shares are trading near the lower rail of a sustained six-month range, with potential support at the 200-day exponential moving average at 580, former support at 540 and support converted from resistance at 500.”
Author: Hu Tianjiao Editor: Elaine Lee
Posted by:CoinYuppie，Reprinted with attribution to:https://coinyuppie.com/musk-and-dogcoin-bitcoin-in-and-out-of-the-yangtze/
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