Bitcoin yesterday hit a two-week peak just shy of US$40,000, after another weekend reacting to tweets from Tesla Inc chief executive Elon Musk, who fended off criticism over his market influence and said Tesla sold bitcoin, but might resume transactions using it.
Bitcoin has gyrated to Musk’s views for months since Tesla announced a US$1.5 billion bitcoin purchase in February and said it would take the cryptocurrency in payment.
He later said the electric vehicle maker would not accept bitcoin due to concerns over how mining the currency requires high energy use and contributes to climate change.
“When there’s confirmation of reasonable (~50%) clean energy usage by miners with positive future trend, Tesla will resume allowing Bitcoin transactions,” Musk wrote on Twitter on Sunday.
Bitcoin rallied more than 9 percent after that message, breaking above its 20-day moving average, and it climbed a tiny bit further in Asia to hit US$39,838.92.
“The market had been going through another round of correction over the weekend ... until Elon Musk’s tweet of accepting BTC [bitcoin] again for Tesla purchases changed sentiment,” said Bobby Ong, cofounder of crypto analytics Web site CoinGecko (幣虎).
He said the market was also supported by software company and major bitcoin-backer MicroStrategy Inc raising US$500 million to buy bitcoin.
Bitcoin is up about 33 percent this year, but has collapsed from a record peak above US$60,000 amid a regulatory crackdown in China and Musk’s apparently wavering enthusiasm for it.
Tesla stock is down about 30 percent since the company’s bitcoin purchase.
Musk’s tweet was made in response to an article based on remarks from Magda Wierzycka, head of cybersecurity firm Syngia Inc, who in a radio interview last week accused him of “price manipulation” and selling a “big part” of his exposure.
“This is inaccurate,” Musk wrote. “Tesla only sold ~10% of holdings to confirm BTC could be liquidated easily without moving market.”
Musk had tweeted last month that Tesla “will not be selling any bitcoin” and “has not sold any bitcoin,” but investors are keenly awaiting Tesla’s next earnings update — due next month — for any disclosure of changes to its position.
Musk has taken issue with the vast computing power required to process bitcoin transactions and early this month posted messages appearing to lament a breakup with bitcoin.
Other cryptocurrencies were steady after weekend gains, with ether at US$2,491 and one-time Musk darling dogecoin buying about US$0.32 on crypto exchange Binance (幣安).
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