Musk effect: Bitcoin sinks to three-month low on Musk comments

Bitcoin slashed to a three-month low on Monday as investors sold cryptocurrencies in the wake of Elon Musk hinting over the weekend that Tesla is considering selling or may have already sold some of its Bitcoin holdings.

Musk’s ardent support for cryptocurrencies has boosted crypto markets in the recent past. But lately, he has roiled trade by appearing to cool on Bitcoin in favour of its one-time parody, dogecoin. The gyrations are beginning to spook even steeled traders.

Bitcoin fell more than 9 percent on Monday to $42,185, its lowest since February 8, while ether, linked to the ethereum blockchain, fell about 8 percent to $3,227.22. Dogecoin fell nearly 7 percent to $0.48, and all three are well under recent records.

Musk’s disclosure in early February that Tesla had invested $1.5bn in corporate cash to buy Bitcoin sent the token’s price to a record high and lent legitimacy to virtual currencies, which have come closer to being a more mainstream asset in recent months despite lingering scepticism.

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