Over a week ago, Elon Musk announced that Tesla would stop accepting payments in Bitcoin for its electric cars, which led the price to collapse. In recent days, the entrepreneur tweeted that he talked to some miners who promised to use renewable energy, driving the price higher again.
Tesla’s CEO Elon Musk seems to have consolidated his role within the world of cryptocurrencies. His comments can cause dramatic drops and rises in the price of the pioneering cryptocurrency. After having caused the recent collapse in Bitcoin’s price, he wrote a tweet that drove it higher again.
The largest bullish rally in Bitcoin’s price since its birth in 2008 started at the end of 2020. In that period, the price of the main cryptocurrency on the market reached several new all-time highs until exceeding USD 60,000. The main altcoins on the market, which include Ethereum, Binance Coin and Cardano, also followed it to reach record figures.
These Two Factors Contributed to the Recent Crash in Bitcoin’s Price
A series of bad news ended this virtually uninterrupted boom period a few days ago. That situation led investors to lose faith in the future of Bitcoin, making its price collapse along with that of other cryptocurrencies.
This market crash started when billionaire Tesla’s CEO Elon Musk tweeted that Tesla would stop accepting Bitcoin as payment for its electric cars. They had been accepting the cryptocurrency as a payment means for just a few weeks. Almost immediately, the Chinese government announced that it would maintain and tighten legal restrictions against transactions with cryptocurrencies within the country. Those two factors contributed to making Bitcoin lose half of its value in a matter of a few days.
A New Tweet from Elon Musk Made Bitcoin’s Price Increase Again
China still maintains the restrictions against Bitcoin and Tesla still does not accept Bitcoin as payment for its electric cars. However, the trend seems to be changing again thanks to a new tweet from Elon Musk.
There have been new hopes in the market after the billionaire entrepreneur wrote about a group of American Bitcoin miners. He said that they promised to use renewable energy in their activities to avoid harming the environment. The negative environmental effects of Bitcoin mining were Tesla’s alleged arguments not to accept payments in Bitcoin.
“We spoke to the North American Bitcoin miners. They committed to publishing the current planned usage of renewable energy. [They also promised] to ask [other] miners around the world to do so. [This is] potentially promising,” Elon Musk wrote in his tweet.
The cryptocurrency markets worldwide reacted immediately after Elon Musk posted his tweet. Cryptocurrencies changed the negative trend that they had shown during the last days to begin to gradually recover their price. Bitcoin is currently trading at around USD 38,978, above the price of USD 31,248 that it recently reached. The community hopes that the price of the pioneering cryptocurrency can climb even higher.
By Alexander Salazar
