Key Takeaways:
- Bitcoin falls nearly 9% since Thursday, part of wider decline in risky assets.
- SpaceX’s reported sale of bitcoin adds to market worries.
- Around $1 billion pulled out of crypto market in 24 hours, almost half from bitcoin.
- Bitcoin trading at $26,327, down 16% from this year’s peak.
Bitcoin’s price has fallen by nearly 9% since early Thursday, contributing to a wider decline in risky investments. This drop comes alongside news that Elon Musk’s company SpaceX sold off its bitcoin holdings.
Around $1 billion has been taken out of the cryptocurrency market in the last 24 hours, with almost half of this being from bitcoin, according to CoinGlass, a cryptocurrency trading platform.
As of Friday morning, bitcoin is trading at $26,327, which is 16% lower than its peak earlier this year in July.
The sell-off on Thursday affected not only the stock market but also safer investments like government bonds. This happened after officials at the US Federal Reserve expressed concern about high inflation, hinting at a potential interest rate increase.
SpaceX’s Role:
The Wall Street Journal reported on Thursday that SpaceX adjusted the value of its bitcoin holdings by $373 million last year and in 2021. The company also sold its bitcoin.
This news caused a worried reaction in the cryptocurrency market, according to Hani Abuagla, a senior market analyst at online broker XTB.
SpaceX has not yet responded to CNN’s request for comment.
Elon Musk had been a strong supporter of bitcoin, initially announcing in early 2021 that his company Tesla would accept it as payment. However, Tesla later changed its plans. The company also sold a significant part of its bitcoin holdings last year.
The cryptocurrency market has faced increased scrutiny from US regulators recently. In June, the Securities and Exchange Commission (SEC) filed a lawsuit against Coinbase, the world’s largest cryptocurrency exchange, claiming it was operating as an unregistered broker. Coinbase denied the allegations.
This week, Coinbase received regulatory approval to offer US investors access to cryptocurrency derivatives, which make up about 75% of global cryptocurrency trades.
Source: CNN (https://edition.cnn.com/2023/08/18/investing/bitcoin-price-drop-space-x-selloff/index.html)
