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Home / Business / After Elon Musk said that the price seemed high, the price of Bitcoin (BTC) dropped by 10%

After Elon Musk said that the price seemed high, the price of Bitcoin (BTC) dropped by 10%



Bitcoin surged to an all-time high on Tuesday, reaching the $50,000 milestone of $50.602.

Alan Piton | NurPhoto | Getty Images

On Monday, Bitcoin slipped, halting its amazing gains, after Elon Musk said the price “seems to be high”.

According to data from Coin Metrics, the world̵

7;s most valuable cryptocurrency fell more than 10% to a price of $51,993 on Monday morning. Bitcoin once fell below $50,000 to $47,700.

It is not yet clear why Bitcoin fell on Monday. Tesla’s chief executive said on Saturday that the prices of Bitcoin and rival tokens appear to be too high. Bitcoin rose to more than $58,000 on Sunday, but has since reversed.

As of 10:25 a.m. EST, the Bitcoin transaction price has fallen by about 8%, at a price of $53,375. It is worth pointing out that price fluctuations of more than 10% are not uncommon among cryptocurrencies. Bitcoin once climbed to nearly $20,000 in 2017, and then fell by 80% in the following year.

U.S. Treasury Secretary Janet Yellen warned on Monday that Bitcoin is a “highly speculative asset” and expressed her concern that investors will lose money.

The former chairman of the Federal Reserve said: “This is an extremely inefficient way of doing transactions, and processing these transactions consumes incredible energy.”

So far this year, digital coins have still risen by more than 80%. According to CoinDesk’s data, last week, Bitcoin’s market value reached $1 trillion for the first time, and it is now back below this level. The news that major Wall Street banks and Fortune 500 companies are heating up to cryptocurrency promoted the development of the token.

Musk recently appeared as a believer in Bitcoin, calling it a “good thing” and saying that he thinks it “is on the verge of being widely accepted by traditional financial professionals.”

Earlier this month, Tesla stated that it has purchased $1.5 billion worth of Bitcoin and will accept cryptocurrency as payment for its products. According to Dan Ives of Wedbush Securities, the electric car manufacturer received approximately $1 billion in paper profits from its Bitcoin investment.

Ives estimated in a report released on Saturday that Tesla “is expected to get more from its Bitcoin investment, rather than the profit from selling its electric vehicles throughout 2020.”

Bitcoin is attracted to mainstream investors, partly because people think Bitcoin is a store of value similar to gold. Bitcoin bulls are trying to prove that investors should add cryptocurrencies to their portfolios to hedge against potential inflation.

But the skeptics were not convinced. JPMorgan analysts stated in a report last week that Bitcoin is an “economic performance” and that the rise of digital finance rather than Bitcoin is “the true financial transformation story of the Covid-19 era”.


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