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What about bitcoin? The 'Musk effect' and possible controls send the price staggering

2021-05-19T10:40:38.085Z


The most famous digital currency was hit hard, falling more than 20% in one week. 05/17/2021 12:12 PM Clarín.com Economy Updated 05/17/2021 12:16 PM Bitcoin investors experienced a true roller coaster ride in recent weeks led by mega millionaire Elon Musk. In just seven days, the tycoon went from announcing that his flagship company, Tesla, would stop accepting bitcoin as a means of payment to implying that the company would undo all its positions in the cryptocurrency. This


05/17/2021 12:12 PM

  • Clarín.com

  • Economy

Updated 05/17/2021 12:16 PM

Bitcoin investors experienced a

true roller

coaster

ride

in recent weeks led by mega millionaire

Elon Musk.

In just seven days, the tycoon went from announcing that his flagship company,

Tesla, would stop accepting

bitcoin as a means of payment to implying that the company would undo all its positions in the cryptocurrency.

This caused the price of the most famous digital currency to plummet

more than 22% in one week, from US $ 65,000 to trading below US $ 45,000.

Behind the public statements of the super influencer Musk lies

an investigation in the United States against Binance -

the largest crypto exchange globally - for money laundering, which for many is the starting point for a

more exhaustive regulation

in that country for everything the cryptocurrency market.

The impact of Elon Musk's tweets was immediate and

the price of the main digital asset plummeted from around $ 57,000 to $ 46,000.

In the last hours it rose, but beyond some moments in which it seemed that it could take off again, its price remains

below US $ 50,000.


Although Musk now clarified on the bird's social network that

his company did not sell its bitcoins,

doubts about the future of the cryptocurrency persist.

Musk responded to a comment where he was accused of being responsible for the crypto losing more than 20% of its value in recent days and said: "To clear up speculation,

Tesla did not sell a single bitcoin."

To clarify speculation, Tesla has not sold any Bitcoin

- Elon Musk (@elonmusk) May 17, 2021

The seesaw that the tycoon drives makes the waters divide regarding the future of this cryptocurrency.

On the one hand, its detractors point out how

the price would be inflated

, since a single message on a social network serves to cause a

stampede of investors

.

But, on the opposite side, the enthusiasts of this currency assure that

there is no price adjustment that can stop the trend.

"No person or institution will be able to change or stop bitcoin,"

Square CEO

Jack Dorsey said

through his Twitter account, the social network of which he is CEO and founder.

Without pointing a finger directly at Musk, Dorsey took to an exchange of impressions on the microblogging social network to claim that he agrees with the premise that

no person or institution could stop the cryptocurrency.

He also defended that Square "will always work" to improve bitcoin.

Meanwhile,

Blackrock

Chief Investment

Officer

(

CIO)

Rick Rieder noted that bitcoin "

was part of the investment arena for years to come

.

"

Another of those who maintains that despite the price correction there is no risk of collapse is the analyst Willy Woo pointed out that

the main cryptocurrency was undervalued

, considering the price of 7 days ago, close to US $ 58,000.

Woo stated that it is very likely that in the coming weeks a migration of money invested in altcoins towards bitcoin will begin.

The truth is that the Musk effect also infected the other cryptocurrencies.

Ethereum,

the second cryptocurrency in market capitalization,

lost more than 10.5% in

the last 24 hours and is trading below US $ 3,400 this Monday.

Greed or fear

According to the

Fear and Greed (fear and greed)

index

, the stance on bitcoin reached a point of

"extreme fear",

falling to the levels of the 2020 crisis, unleashed by the start of the COVID-19 pandemic.

This Sunday that index reached 20, a mark that indicates the

"extreme fear"

 towards investing in BTC according to the Fear and Greed Index.

This Monday's update places the index at

"fear"

, with the mark at 27.

The Fear and Greed Index

measures market sentiment

.

In the case of cryptocurrencies, the behavior is "very emotional."

This index is often used as a

buy or sell indicator,

depending on general market sentiment.

For this, data such as the dominance of bitcoin in the market, mentions in social networks, volatility, trade volumes and search interest on the subject on Google are analyzed.

In the case of bitcoin, the index serves to account for the extreme volatility of recent days. 

Just a week ago, the general sentiment was one of "greed," with a 72 on the index.

YN

Look also

Elon Musk announced an agreement between SpaceX and Google to offer satellite internet

Bitcoin: United States investigates Binance, the world's largest cryptocurrency exchange, for money laundering

Source: clarin

All business articles on 2021-05-19

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