Bitcoin & Other Cryptocurrencies Drop: Speculations Around SpaceX selling $373M worth of Bitcoin

Bitcoin, the world’s most valued cryptocurrency, faced a sharp decline, reaching its lowest in two months, reflecting the heightened risk aversion reverberating throughout global markets.

In a significant downturn, the cryptocurrency behemoth saw its value decrease by 7.2% on Thursday, marking its steepest decline since November 2022, coinciding with the FTX exchange collapse. On Friday, during Asian trading hours, the price plummeted to a meager $26,172 but managed a minor bounce back to $26,441 by 0835 GMT.

The distress isn’t unique to Bitcoin. The globe’s financial nerve centers are feeling the jitters. Wall Street ended Thursday on a sour note, while Asian stock markets are gearing up for their third consecutive week of losses. Underpinning these bearish trends are concerns about the stability of China’s economy and speculations about a prolonged period of elevated U.S. interest rates, backed by a seemingly sturdy American economy.

Ether, another heavyweight in the crypto realm, experienced a sharp decline on Thursday but managed to maintain its stance at approximately $1,685.20.

An intriguing development around SpaceX, as reported by the Wall Street Journal, suggests that the company, under Elon Musk’s leadership, liquidated its Bitcoin assets post a staggering $373 million write-down. Considering Musk’s significant influence among crypto aficionados, the news potentially acted as the immediate fulcrum for the crypto’s downward spiral, as opined by Ben Laidler, eToro’s Global Markets Strategist.

However, Laidler also highlighted the larger picture, stating that “crypto assets are not immune to the deepening risk-off selling pressure seen across all asset classes.”

Joseph Edwards of Enigma Securities gave a slightly varied perspective, hinting at the stagnation caused by diminished retail investor enthusiasm and the low-volatility environment.

Recent trends showed Bitcoin oscillating close to the $30,000 benchmark, notably after its 2022 dip when numerous crypto enterprises went under. The market received a shot in the arm in June when BlackRock declared its intention to inaugurate a spot Bitcoin ETF in the U.S. The move was widely perceived as a prelude to the U.S. SEC’s impending green signal for spot Bitcoin ETF requisitions from several asset giants, including Grayscale.

However, Edwards cautions, “The big concern right now is that this might be a frontrun on the outcome of Grayscale’s lawsuit against the SEC; optimism on that front has been keeping markets inflated.”

Apart from these factors, the escalating treasury yields, apprehensions about China’s economic trajectory, and the U.S. bankruptcy announcement by Evergrande — a mammoth property enterprise — might also be affecting Bitcoin’s trajectory, according to bitbank, a Japan-based firm.

To top it all, Markus Thielen of Matrixport shed light on the past, recalling Bitcoin’s 23% nosedive following China’s currency devaluation in 2015. With rumors suggesting China’s potential move to weaken the yuan, history might be on the verge of repeating itself.


Adding fuel to the fire, the current low crypto trading volumes are causing more volatility, making the future of Bitcoin and other cryptocurrencies an intriguing space to watch.

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