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Elon Musk Tweets 'Spoke with Bitcoin Miners', Cryptocurrencies Bounce Back From Sell-off

The latest tweet from Tesla boss appeared to soften his stance against the environmental impact of the cryptocurrency

The latest tweet from Tesla boss appeared to soften his stance against the environmental impact of the cryptocurrency

On Monday, Elon Musk, the celebrity chief executive officer of Tesla had tweeted on bitcoins and the popular cryptocurrency jumped more than 10%

Elon Musk did it again. On Monday, the celebrity chief executive officer of Tesla had tweeted on bitcoins and the popular cryptocurrency jumped more than 10%. Bitcoin was last up 12% at approximately $39,400, erasing losses of 7.5% from a day earlier but still down by more than 40% from last month’s record high. Ether, the second-largest cryptocurrency rose nearly 19% to $2,491 after slumping more than 8% on Sunday.

The latest tweet from Tesla boss appeared to soften his stance against the environmental impact of the cryptocurrency. On May 13, Musk said that Tesla will no longer accept bitcoin due to its consumption of fossil fuels during the mining process. “Cryptocurrency is a good idea on many levels and we believe it has a promising future, but this cannot come at great cost to the environment. Tesla will not be selling any Bitcoin and we intend to use it for transactions as soon as mining transitions to more sustainable energy," he said. Bitcoin plunged by around 10% soon after the tweet.

On Monday, Musk said, “Spoke with North American Bitcoin miners. They committed to publish current & planned renewable usage & to ask miners WW to do so. Potentially promising. ”

Bitcoin is up approximately 35% this year but down nearly 40% from the year’s high of $64,895.22 on April 14.

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The cryptocurrency had stabilized from a bruising week on Saturday after Tesla boss Musk tweeted support for crypto in “the true battle” with fiat currencies. “It is too early to call the end of the recent bitcoin downtrend,” J.P. Morgan analysts wrote.

On Monday, Federal Reserve Governor Lael Brainard told a virtual conference organized by CoinDesk that the growth in “private money,” digital payments and steps by other central banks were sharpening the focus on Central Bank Digital Currencies, or CBDC. Her comments were echoed later in the day by Atlanta Fed President Raphael Bostic. “It is moving fast. The crypto space in particular right now if you characterized it – it is an extremely volatile market and I don’t think its characteristics right now are conducive for them to be currency,” he said.

For cryptocurrency investors in India, Vikram Rangala, chief operating officer, ZebPay said, “Bitcoin had a good rally and was due for a correction. However, Bitcoin still has the same underlying strength as perhaps the best store of value."

“Long-term value investors might call these lower prices a buying opportunity.  Investors should invest in education first. Research the underlying value of Bitcoin, Ethereum, and other crypto assets as you might look at a company’s information before buying stocks. Use strategies like rupee cost averaging and SIPs to more confidently manoeuvre through volatility and take a long-term view," he further added.

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first published:May 25, 2021, 13:31 IST