Where’s the Father? 💸

Where’s the Father?

In my opinion, cryptos have had a better time during the pandemic than the boom in 2017, and I’m sure many agree with me. I mean, the price speaks for itself as Bitcoin and other cryptos have set new records, with Bitcoin’s value absolutely crushing the measly 20,000 that was set in 2017. Cryptos have received some institutional support, with Goldman Sachs creating a cryptocurrency trading team and JPMorgan offering a Bitcoin fund. However, no one has been as powerful as Elon Musk.

With how popular Musk is in the financial world, I doubt anybody needs an introduction. To keep it short, he is the CEO of Tesla, one of the highest valued companies, the CEO of SpaceX, and the 2nd richest person in the world. Elon has gained the support of many traders, allowing him to have more influence than anybody else in the stock market. For example, Elon once tweeted “GameStonk”, which sent the price of GameStop flying. The mention doesn’t need to be as blunt; Musk once tweeted about the Model S, saying that you can play games, listing the example of Cyberpunk 2077, a game that received a lot of backlash for its glitches. That alone sent its parent company, C.D Projekt, up 12 percent.

With this power, he can send things down too. Musk has been a supporter of cryptocurrencies such as Bitcoin, so his announcement on Wednesday came as a surprise. Elon announced that Tesla will no longer be accepting cryptocurrencies as payment for their cars. This instantly sent Bitcoin and other cryptos, such as Dogecoin, into a correction. It was estimated that 365 billion dollars were wiped from cryptos because of the announcement, which is crazy for one company’s announcement. Well, it’s Tesla, so it does make some sense. Tesla cited environmental reasons, which is a valid point. Crypto mining causes a lot of emissions, and Tesla is a clear example of a company who wants to help the environment. However, it is a bit suspicious when you look at Musk’s transactions. Tesla bought Bitcoin in early 2021 and announced that they sold it in their recent earnings call. The timing seems oddly perfect, but we will never know. Do you think it’s a good idea to buy the dip on cryptos now?

I am not a financial advisor and my comments should never be taken as financial advice. Investments come with risk, so always do your research and analysis beforehand.

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