Economy

Bitcoin (BTC) is down 10% after Elon Musk said prices appear high

Bitcoin (BTC) is down 10% after Elon Musk said prices appear high

On Tuesday, Bitcoin rose to an all-time high of $ 50,000, at $ 50.602.

Alan Beaton | Norphoto | Getty Images

Bitcoin It slipped on Monday, stopping its surprising height after that Elon Musk Listed PricesLook high. “

The world’s most valuable cryptocurrency sank more than 10% to a price of $ 51,993 Monday morning, according to data from Coin Metrics. At one point, Bitcoin dropped below the $ 50,000 level, down to $ 47,700.

It was not immediately clear why Bitcoin moved lower on Monday. at. Saturday, Tesla The CEO said competing bitcoin and ether prices appear excessive. Bitcoin rose to over $ 58,000 on Sunday, but has since reversed course.

As of 10:25 AM ET, Bitcoin was trading down about 8% at $ 53,375. It should be noted that price fluctuations of more than 10% are not uncommon in cryptocurrencies. Bitcoin It once jumped to nearly $ 20,000 In 2017 before it shed 80% of its value the following year.

US Treasury Secretary Janet Yellen warned on Monday that Bitcoin is a “highly speculative asset” and said she was concerned about investors losing their money.

“It’s a very inefficient way to conduct transactions, and the amount of energy that is spent processing these transactions is staggering,” said the former Federal Reserve Chairman.

The digital currency is still up by more than 80% so far this year. Last week, Bitcoin was valued at $ 1 trillion in the market for the first time – now it’s back below that level, according to CoinDesk. The token has gotten a boost from news of major banks on Wall Street and the Fortune 500 companies moving towards cryptocurrencies.

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Musk recently Come out as a believer in BitcoinDescribing this as a “good thing” he said he believed it was “on the verge of getting broad acceptance by traditional finance experts.”

Earlier this month, Tesla said it had bought $ 1.5 billion of Bitcoin and would accept the cryptocurrency as payment for its products. The electric car maker has made nearly $ 1 billion in paper profits from its bitcoin investment, according to Dan Ives of Wedbush Securities.

Ives estimated in a note published on Saturday that Tesla is “on its way to making more of its bitcoin investment than the profits from selling its electric cars in 2020.”

Bitcoin is gaining traction from regular investors, in part because it is believed to be a store of similar value to gold. Bitcoin bulls have tried to demonstrate that investors should add the cryptocurrency to their wallet to hedge against a potential spike in inflation.

But the skeptics are not convinced. Analysts at JP Morgan He said in a note last week that Bitcoin is “View the economic side, “And that the rise of digital finance – not bitcoin – is” the true story of financial transformation in the era of Covid-19. “

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