Wednesday’s extreme price changes caused disruptions in major cryptocurrency exchanges and dominated Wall Street talks.
A 31% drop in the morning. A 33% increase in the afternoon.
Such was the wild trip that Bitcoin took investors on Wednesday, with a reduction of billions in value before comments from some prominent proponents helped propel it into a torrid rebound.
Extreme price changes in an asset known for its turbulence led to disruptions in major cryptocurrency exchanges and dominated Wall Street talks. The riot sparked a tweet from Elon Musk suggesting that Tesla Inc. he was not among the sellers, while Cathie Wood said her monitors launched a “capitulation” that put the digital testimony “on sale.” Justin Sun, a tech entrepreneur who founded the cryptocurrency platform Tron, tweeted that he bought $ 152 million in Bitcoin for about $ 37,000 a coin.
Up to a $ 30,000 beard just after nine in the morning in New York, the currency reduced the loss to 7% and briefly topped $ 40,000 at 1 p.m. , sank more than 40% before halving it.
“The history of these assets has been full of aggressive concentrations and unhealthy sales,” said Stephane Ouellette, executive director and co-founder of FRNT Financial.
They rarely happen in a single session. Volatility dominated Wall Street one day when stocks and commodities were also under pressure and the Federal Reserve had to post minutes of its last meeting. Frenetic selling caused disruptions in some of the major exchanges, from Coinbase Global Inc. to Binance. #Cryptotrading was a trend on Twitter, where critics and fans were in a mess.
Tesla CEO Musk touched on the wild moves last week. Bitcoin fell when it announced that the vehicle manufacturer would not take it as payment, but it was reversed when it said the company had no plans to sell its stakes in corporate cryptography. Wednesday seemed to hint in a tweet Wednesday that Tesla was not coming in fear.
Tesla has 💎 🙌
– Elon Musk (@elonmusk) May 19, 2021
Volatility erupted in crypto-land last week when Musk withdrew his plans to accept Bitcoin for his company’s cars. The sale resumed over the weekend, when the mercurial CEO seemed to suggest that Tesla might want to sell its corporate stakes, but reversed after tweeting that the vehicle manufacturer had no plans to do so. A statement from the People’s Bank of China on Tuesday reiterated that digital tokens cannot be used as a form of payment added to the selloff.
While they were all close causes of defeat, nothing could explain the frantic defeat on Wednesday morning, when the currency dropped thousands of dollars in price in a matter of minutes. The sale led to more sales as investors were attracted to cryptocurrency in search of a quick dollar for exits. Selling accelerated when Bitcoin fell below the average price of the last 200 days.
Chart observers pointed to key technical indicators as the currency sold. Bitcoin bounced back to the $ 30,000 level and many are waiting to see if it can surpass its 200-day average line. If he doesn’t, he could try Wednesday’s lows again.
Shares linked to cryptocurrencies also fell, with Coinbase shares falling close to 13% at one point and Marathon Digital Holdings Inc. fell to 16%.
Bitcoin had embarked on a rally several months after Tesla’s announcement in February, which rose to a high of $ 64,870, largely due to the company’s hug.
At the time, Tesla’s acceptance was considered a turning point for the currency, and many in the crypto world saw it as a further step in its evolution.
Everything that has been deleted after Musk’s tweets.
“Really, it’s not the first time Elon Musk’s tweets have been erratic and frankly wrong,” said Ulrik Lykke, executive director of cryptocurrency ARK36. “Cryptography markets are extremely emotionally driven and their participants are prone to overreacting to events they perceive as negative.”