Musk’s assets shrink by $80 billion as cryptocurrency “backfires”

Tesla CEO Elon Musk is the one who has the power to make the trillion dollar cryptocurrency market a fiasco with just his own power.

Musk's assets shrink by  billion as cryptocurrency "backfires"

Assets shrink by $80 billion, Musk “backfired” on the cryptocurrency world

Tesla CEO Elon Musk is the man with the “power to destroy” the trillion-dollar cryptocurrency market by himself.

Previously, he had pulled the pan for Bitcoin several times, taking the market from $40,000 to a high of $60,000 and setting fire to Dogecoin, SHIB, and other cryptocurrencies, before flipping out at light speed, causing Bitcoin to fall and bloodbath the entire cryptocurrency market.

“Cryptocurrency plunge” has become the keyword in the cryptocurrency world recently. Since May 19, bitcoin prices have experienced three roller-coaster plunges, with market capitalization once decimated.

According to CoinGecko, the total market value of cryptocurrencies fell to $1.6 trillion, a 36% drop from the previous high of $2.5 trillion. Also according to Bybt data, the blowout reached $6.4 billion (about RMB 41.1 billion) within 24 hours, with a total of about 775,700 people becoming victims of the blowout.

“The surface reason for the cryptocurrency collapse is caused by the three major associations in China joining hands to ‘block’ cryptocurrencies, but the deeper reason actually lies in Musk’s nonsense and repeated horizontal jumps all day long, using his personal influence to manipulate the cryptocurrency market.” Li Minglei, a cryptocurrency practitioner, is indignant, “Musk’s manipulation would be fined tens of millions of dollars by the SEC in the stock market, but no one can control it in the cryptocurrency world.”

It is also because no one can control, “horse-hating” emotions gradually spread in the cryptocurrency circle. The attitude of those who once followed Musk to the death and regarded him as the god of wealth has changed dramatically, and they even started to call for shorting Tesla on social media to punish Musk’s arbitrary manipulation of the cryptocurrency market, and even Jackson Palmer, co-founder of Dogcoin, who has always kept a low profile, tweeted to accuse Musk, saying he “has been a selfish liar and will be so in the future.”

With his personal value shrinking dramatically and losing the title of the world’s second richest man, Musk, the cryptocurrency trendsetter and Silicon Valley’s Iron Man, is rapidly falling from grace.

The unpredictable Musk

Musk’s influence in the cryptocurrency space is so great that even Satoshi Nakamoto, the founder of Bitcoin, can hardly compete with him.

As a prime example, Musk simply changed his Twitter profile to “#bitcoin” and the price of bitcoin shot up to $38,000, an 18 percent jump at one point.

In fact, there are numerous similar examples.

In the early morning hours of May 17, a user named “cryptowhale” tweeted, “Bitcoin investors will slap themselves in the face next quarter when they find out that Tesla sold off their remaining positions. Below the tweet, Musk commented, “Indeed.”

Normally, this slightly trollish tweet might not have made waves, but after Musk’s comment, the entire cryptocurrency market exploded, and the comment was interpreted as Musk suggesting that Tesla has sold or will sell its bitcoin holdings.

Immediately thereafter, the price of bitcoin went into a flash crash, eventually dropping all the way below $43,000, a drop of nearly 12%, to a three-month low.

However, on the afternoon of May 17, a user named “Bitcoin Archive” tweeted @Musk, “Bitcoin has dropped 20% since you started posting, you should think about why People are mad at you.” Musk replied at the bottom of the tweet: “Let me clarify, Tesla is not selling Bitcoin”.

Once this comment was made, bitcoin quickly rallied back to $45,000, and despite the fall in the price of the currency, Musk did as much damage to the cryptocurrency market as a tsunami. Data from BitcoinHome.com shows that more than 200,000 people have suffered a blowout and nearly 12.5 billion yuan of wealth has gone up in smoke in 24 hours during this dramatic market volatility.

On May 13, Musk tweeted, “Tesla has called a halt to car purchases with Bitcoin, we are concerned that Bitcoin mining and trading is leading to a rapid increase in fossil fuel consumption, especially coal, which is the worst of all fossil fuel emissions”.

Shortly after Musk released these comments, cryptocurrencies began to sink en masse, with Bitcoin diving more than 17% at one point, and over 300,000 people suffering a blowout within 24 hours, with about 24 billion RMB of wealth evaporating.

Just two months ago, however, Musk had a completely different attitude about using bitcoin to buy cars. At the time, he tweeted, “Now you can buy a Tesla with Bitcoin.” He also added below that Tesla uses internal and open-source software to operate Bitcoin nodes directly, and that Bitcoin paid to Tesla will continue to be retained in the form of Bitcoin rather than converted into fiat currency.

“Combine this with the various things Musk has done over the past few months, including bringing fire to dogcoin and then changing his tune on the show and calling it a scam, and you can see that Musk has a cloudy attitude towards cryptocurrencies, and his ability to play the price of cryptocurrencies completely out of hand, meaning that he alone can manipulate the price up or down, is a huge disaster for the cryptocurrency community. ” Li Minglei still has a vivid memory of what happened at that time, “He was the one who blew up Bitcoin, and he was the one who disliked Bitcoin for consuming too much energy, and the speed of this change of face was comparable to the face of Sichuan opera.”

Anthony Denier, CEO of cryptocurrency trading platform Webull, also hit the nail on the head when he said, “Bitcoin has been vulnerable to shocks lately, and just one person’s comments can do that. When fundamentals don’t matter and the market is focused on the whims or comments of one trader, we’re in dangerous territory.

Musk did more than “manipulate” the cryptocurrency world

Musk has taken the entire cryptocurrency market into dangerous territory, but has rewarded Tesla with real money.

According to Tesla’s Q1 2021 earnings data, Tesla reported a net profit of $438 million for the quarter, up 2,638% from $16 million in the same period last year. It’s worth noting, however, that by selling some of its bitcoins at a high level, Tesla made a net profit of $101 million. This means that the profit from the sale of Bitcoin has accounted for 1/4 of the total net profit.

Tesla’s chief financial officer Zachary Kirkhorn said on a conference call that the bitcoin position was reduced by 10% for the quarter, and that this partial reduction helped the overall company’s quarterly earnings growth slightly. Tesla will continue to invest in bitcoin and believes in its long-term value.

Whether Tesla believes in the long-term value of bitcoin is not yet known, but Musk is definitely a connoisseur of short-term arbitrage.

On February 8, 2021, Tesla said in a financial report filed with the SEC that it had bought $1.5 billion (about $10 billion) worth of bitcoin to diversify and maximize its investments. And at the bitcoin price at the time, Tesla’s average buyout price was less than $25,000.

When combined with Tesla’s first quarter earnings data, and looking back at Musk’s previous series of fancy bitcoin promotions, a carefully orchestrated “conspiracy” gradually emerges.

In fact, this is not the first time Musk has used his personal influence to manipulate prices via Twitter.

On August 7, 2018, Musk announced on Twitter without warning that he was “considering taking Tesla private at $420 per share and already has the funds secured”. The tweet triggered a stock market shakeup directly after it was sent, with Tesla’s stock price jumping 11 percent.

But two weeks later, Musk said he had abandoned the plan, and the SEC then filed a lawsuit against Musk in U.S. federal court in Manhattan, accusing him of intentionally misleading investors and alleged fraud. After investigation, it was found that Musk had only communicated with the Saudi state sovereign fund and did not implement the partnership plan. There was speculation at the time that Musk was trying to use the tweet to pressure negotiating parties or attract more capital bids.

Musk later settled with the SEC, with himself and Tesla each fined $20 million to repay investors for their losses. At the time, one theory was that Musk had gained far more from the incident than he had been fined.

This was backed up by a tweet from Musk, who tweeted on Oct. 28 that the tweet that led to the $20 million fine imposed on him by the SEC was “well worth it.

But it’s in the unregulated world of cryptocurrencies that Musk has really felt the freedom to manipulate the market, compared to the heavily regulated stock market.

“Musk’s method is simple and brutal, that is, first pulling the plate by various ways, pulling it to a high level and then shipping it out, smashing the plate after it is out, and then waiting for a low price to recover.” Li Minglei said to “Whiplash”, “This is to use the cryptocurrency circle as an ATM, Musk not only does not have to dilute shares, but also can bypass regulation to allow Tesla and SpaceX to achieve freedom of financing. Next time whichever of his companies needs to raise money, he may again frantically pull up the price of his own cryptocurrency holdings and then wait for an opportunity to sell them”.

It is a fact that investors know that Musk is manipulating the cryptocurrency world, and Musk knows that investors know that he is manipulating the cryptocurrency world, but looking at the current cryptocurrency world, there is hardly any mechanism or law that can sanction the “Musks”.

Musk has no “believers”

Half a month ago, Musk’s words and actions were regarded as the guiding principle of the cryptocurrency circle, and he himself was hailed as the “godfather of the cryptocurrency circle” by the cryptocurrency circle, with his followers all over the world.

As Musk’s status in the cryptocurrency world grows, so do the number of followers, especially for his 55 million followers on Twitter, where Musk is not only the helmsman of Tesla and SpaceX, but also a guiding light to their riches. A recent study by global consumer research platform Piplsay shows that more than 1/3 of U.S. adults have invested or considered investing based on Musk’s tweets.

“A word from Musk is the curve of the cryptocurrency world.” One Musk devotee publicly proclaimed his admiration for Musk on Twitter, and even more so, wrote a song for Musk and even wanted to create a special holiday for Musk.

Yet just half a month later, Musk has suddenly become a target from the crowd.

It was Musk who said “I won’t sell Bitcoin”, Musk who said “I might sell Bitcoin”, and Musk who said “I definitely won’t sell Bitcoin”. The company has been able to manipulate the trend of bitcoin at will and put worthless cottage coins on the throne.

A user named “QQQQup” tweeted angrily, “Stop talking about Musk! Bitcoin is a success without him! It doesn’t matter what Musk says! Forget what he says! He’s not the god of virtual currencies!”

After the cryptocurrency market experienced a flash crash, Musk asked in a tweet on May 20, “How much is the dogcoin in the window?” and later replied to a fan saying, “There aren’t and won’t be any dogcoins for sale.”

Hours after the news broke, dogcoin rose by more than 11% for a short time and 26.54% in 24 hours. You know, not long ago Musk was laughing at the famous American show “Saturday Night Live” as dogcoin “is a scam”, leading to an avalanche of more than 30% in the price of dogcoin.

For Musk’s change of face again, a fan questioned under his tweet, “Musk, I invested my life savings because you said so. Now I have nothing.” “I went and invested because of you! I have nothing now, can you give me my money back?” “I invested my life savings in virtual currency. I’ve lost everything, I’ll never see my kids again, and I’ve become a homeless bum.”

Before that, American Internet celebrity David Portnoy posted a video ranting against Musk’s capriciousness, “One minute you say you’re going to buy something, the next minute you’re not. This is playing with people’s future and destiny.”

And in China, Musk likewise went from cryptocurrency trendsetter to reviled object. In comments on the Weibo hot topic #BitcoinPlunge, one user said, “Used to be a Musk believer, but now he’s got me in debt.” “Musk is just playing people like a monkey and not taking any responsibility for what he says.”

Musk became the “public enemy”, angry investors called together to short Tesla. Data show that since this year, Tesla shares have fallen 16.85%, Musk’s personal value has also shrunk significantly.

According to media reports, Musk’s personal value has now shrunk by $12.3 billion, or about 80 billion yuan, making him the most shrunken billionaire in the Bloomberg Billionaires Index, and has lost his throne as the world’s second richest person, currently ranking third.

And Musk’s latest tweet about cryptocurrencies said, “The real war is between fiat money and cryptocurrencies. On balance I support the latter.” Musk’s series of tawdry maneuvers have made the entire cryptocurrency market a pandemonium and bloodbath, which in turn has triggered close attention from regulators.

Posted by:CoinYuppie,Reprinted with attribution to:https://coinyuppie.com/musks-assets-shrink-by-80-billion-as-cryptocurrency-backfires/
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