Bitcoin crashes below $50,000 after more cryptic Elon Musk tweets

Posted: 23 February 2021 5:57 pm

Bitcoin has recorded a huge single-day drop as the market reels from Tesla CEO tweets commenting that the maiden cryptocurrency "seems high" after record price action

  • Bitcoin drops nearly 12% after Elon Musk tweets Bitcoin "seems high lol".
  • Rumoured $500 million capital raising for crypto miner Northern Data AG.
  • Altcoins face rout in the wake of sweeping all-time high prices across the market.

Bitcoin is trading at $50,702 at the time of writing, which is a 9.6% decrease in the last 24 hours. Losses reached a low of $49,166, representing a 13.1% decline from the daily high of $56,614.

The drop comes in the wake of comments by Tesla Inc CEO Elon Musk that pricing of Bitcoin and the second-largest cryptocurrency by market capitalisation, Ethereum, "do seem high". Musk's comments have had a material effect on cryptocurrency markets with the price of Dogecoin surging 69% immediately after his tweets.

How to buy Bitcoin

In the days after that, Tesla Inc submitted regulatory filings in which a $1.5 billion Bitcoin acquisition was announced – turbocharging an already unprecedented bull run on the price of Bitcoin, which had hardly lost ground before reaching an all-time high of $58,640.

With Bitcoin rising near 75% in February alone, Tesla's equity holding in Bitcoin is estimated to have increased by more than $1 billion since the initial acquisition, which is believed to have been between late December 2020 and early February of 2021.

The broader cryptocurrency market is witnessing a sell-off with 8 of the top 10 cryptocurrencies by market capitalisation showing double-digit losses at the time of writing.

World's largest cryptocurrency miner in talks to go public

The Bitcoin price drop comes amid Bloomberg reporting on a potential exchange listing in the United States for the operator of the world's largest Bitcoin mine. Northern Data AG is reported to be in talks with Credit Suisse AG on a capital-raising venture estimated to be as high as $500 million according to unnamed sources.

Northern Data AG is the result of a merger between the former Northern Bitcoin and Whinstone US with the company headquartered from the German centre of finance, Frankfurt. The company's largest facility is found in Rockdale Texas, which despite the present electrical failures usually has world-leading hydro-generated power.

The Bitcoin mining industry is on track to meet some of the industry's largest monthly revenue for February. In January of this year, crypto miners realised a total of $1.12 billion in income. As of the time of writing, preliminary figures for February show mining revenue on track to reach above the previous month's.

Interested in cryptocurrency? Learn more about the basics with our beginner's guide to Bitcoin, dive deeper by learning about Ethereum and see what blockchain can do with our simple guide to DeFi.

Disclosure: The author owns a range of cryptocurrencies at the time of writing

Disclaimer: This information should not be interpreted as an endorsement of cryptocurrency or any specific provider, service or offering. It is not a recommendation to trade. Cryptocurrencies are speculative, complex and involve significant risks – they are highly volatile and sensitive to secondary activity. Performance is unpredictable and past performance is no guarantee of future performance. Consider your own circumstances, and obtain your own advice, before relying on this information. You should also verify the nature of any product or service (including its legal status and relevant regulatory requirements) and consult the relevant Regulators' websites before making any decision. Finder, or the author, may have holdings in the cryptocurrencies discussed.

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