Tesla Inc sold nearly 75% of its Bitcoin holdings late Wednesday, causing the virtual currency to temporarily fall in value. Bitcoin rebounded following the announcement.
Elon Musk, Tesla’s CEO, claimed “overall liquidity” as the rationale for the sale of the firm.
As a result of the announcement, the world’s largest cryptocurrency was recently up 1.04 percent at $23,494.57.
Since Tesla acquired $1.5 billion worth of bitcoin at the height of its popularity, the company has sold $936 million worth of the cryptocurrency in the second quarter.
In the BizNews Breakfast Briefing plenty on Tesla quarterlies from last night – it beat profit expectations but nasty surprise for Bitcoin fans; Tech stocks keep rolling; Why Cele really has to go; Solidarity Fund's cash only paid to 100% black businesses: https://t.co/DLAIAPcRQJ pic.twitter.com/rcazGqnzT8
— Alec Hogg (@alechogg) July 21, 2022
Cryptocurrency and Musk
In the past, Musk has been a vocal advocate for the use of cryptocurrency. Whenever he makes predictions about the future of cryptocurrency and discloses his own holdings, dogecoin and bitcoin prices tend to rise.
As Musk said in his company’s quarterly earnings conference, Tesla sold because of concerns about lockdowns in China caused by COVID-19, which has posed manufacturing issues for the company.
Dogecoin, the meme-based cryptocurrency that Musk has promoted, was not sold by Tesla, according to Musk.
Tesla used bitcoin payments for less than two months before discontinuing the service in May 2021. Musk has said that the firm may begin taking bitcoin if it undertakes a thorough investigation into the amount of renewable energy needed to mine the cryptocurrency.
The creator of Dogecoin, Shibetoshi Nakamoto, also shared his views on Twitter regarding this selloff.
why do people freak out when people sell bitcoin?
literal millions of bitcoin are sold every day. no one is buying bitcoin if no one is selling it.
— Shibetoshi Nakamoto (@BillyM2k) July 20, 2022
So far this week, Bitcoin and the stock market have been in recovery mode as investors seem more confident in the US Federal Reserve’s capacity to rein in decades-long inflationary pressure.
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