Elon Musk, the controversial billionaire, said that bitcoin was ‘on the verge’ of being accepted by investors. He expressed his support for cryptocurrency through a social media app, Clubhouse.
The CEO of Tesla Inc is widely known for influencing the market whenever he makes comments on Twitter.
He openly shares that he is a Bitcoin supporter and that he should have bought it eight years ago.
During the chat, Musk also discussed other topics. This includes the Covid-19 vaccines and his companies, to name a few. Tesla’s CEO mentioned that he is expecting an avalanche of Covid-19 vaccines. And as for the authorities, he believes that they should focus more on giving out the first dose and just worry about the second one after. For him, this could speed the entire process.
He also interviewed the co-founder of the online stock broker app, Robinhood, Vladimir Tenev. It was timely as the app was criticized for blocking retail investors from purchasing GameStop stock.
If you must know, GameStop surged in the past month after retail investors bought shares. This could be attributed to Reddit’s WallStreetBets forum, wherein hedge funds lost a lot of money.
According to Tenev, the news about Citadel Securities pressuring Robinhood to block retail investors was not true and was just a plain market rumor. He said that they needed to temporarily halt the trading because of regulatory capital requirements.
Tesla and Bitcoin
Just recently, Musk had invested $1.5 billion in Bitcoin, and it is believed that he acquired 43,000 Bitcoins back in January.
The company stated that it bought Bitcoin so that there will be more flexibility. Plus, they wish to diversify and maximize returns on their cash.
Tesla also shared that they are planning to accept Bitcoin payments for their products. This is, of course, subject to applicable laws and will be on a limited basis. If that happens, Tesla would be the first major automaker to take the path.
This raised the company’s market value above one trillion dollars. From here, Bitcoin prices spiked as well.
However, by February 22, there was a sharp decline in the prices of Bitcoin. And because of that, Musk lost his top spot on the Bloomberg Billionaires Index. Jeff Bezos reclaimed the top position with $186.3 billion.
According to Wedbush Securities analyst Dan Ives, the recent drop of Bitcoin may have prompted investors to sell their shares.
Debate Over Bitcoin
The third richest man in the world, Bill Gates, said that if you have less money than Elon, then you shouldn’t purchase Bitcoin.
This debate about cryptocurrency isn’t new. Even Warren Buffet believes it has no value and will not produce anything. Another skeptic said that it’s also an inefficient way of doing transactions.
However, more companies are accepting Bitcoin. This includes Visa, Mastercard, and Paypal and by the looks of it, the debate is here to stay.
Other Personalities Supporting Bitcoin
There are other prominent people who also support Bitcoin and other cryptocurrencies. Some of the known personalities are Snoop Dogg, and Kiss singer, Gene Simmons.
Simmons shared that he made a six-figure investment in dogecoin and that he owns cryptocurrencies such as Bitcoin.
SatoshiStreetBets and Cryptocurrencies
If WallStreetBets made a lot of noise in recent weeks, another Reddit group is vocal for their support on cryptocurrencies. The group is called the SatoshiStreetBets, where their objective is to pump up the prices of cryptocurrencies.
Musk and His Tweets
Elon Musk has faced enough troubles because of his tweets in the past. In 2018, the SEC charged the CEO of Tesla with fraud. This was rooted in his tweets about taking the company private. He had to pay a $20 million fine on top of another $20 million fine for the company. But of course, no one is certain how his statements about Bitcoin could affect him in the future.
Buying Bitcoin, An Irrational Behavior
After Musk’s tweet about his support for Bitcoin, many people decided to purchase it as well. But according to Katie Martin, a Financial Times columnist, this is just a wild and irrational behavior, and it just shows how amateur investors are showing their amateurishness.
No one can really tell what’s the future of Bitcoin, but with people like Musk backing it up, we understand why most are willing to try it out.
