After Elon Musk's SpaceX Sold All Bitcoin Holdings, Price of BTC Crashes Below $25,000
- Bitcoin plunged below $25,000 in reaction to the news that Elon Musk sold Bitcoin
- Companies with ties to Bitcoin, Coinbase, and others also saw a drop in shares
- There are, however, some pointers to the Futures market as the primary driver of the price drop
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Following the disclosure that Elon Musk's space exploration business, SpaceX, had sold its BTC holdings, Bitcoin plunged sharply below the $25,000 level, frightening investors and dealers.
The price of the most popular cryptocurrency dropped to a low of $24,711, causing shares of companies with ties to Bitcoin, like Coinbase, Marathon Digital, and Riot Platforms, to see comparable drops.
Source: UGC
Legit.ng earlier reported that Nigerians have consistently demonstrated unwavering enthusiasm and curiosity regarding Bitcoin, Ethereum, and other cryptocurrencies despite the challenging period in the cryptocurrency market known as the crypto winter.
Recall that former President Muhammadu Buhari signed the 2023 Finance Act into law, introducing a series of reforms to modernise Nigeria’s fiscal framework before he exited office on May 28, 2023.
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One of the provisions in the Act is the introduction of a 10% tax on proceeds from the disposal of digital assets, including cryptocurrencies.
Musk’s company sold Bitcoin
According to documents examined by The Wall Street Journal, SpaceX has sold all of its Bitcoin holdings after marking them down in value for 2021 and 2022.
The journal noted:
"SpaceX wrote down the value of Bitcoin it owns by a total of $373 million last year and in 2021 and has sold the cryptocurrency."
Financial filings indicated SpaceX's huge expenditure of around $5.2 billion in 2022, covering property purchases, equipment, and R&D spending. However, the actual amount of the sold Bitcoin remains unknown.
Notably, Elon Musk publicly said in 2021 that SpaceX had a specific amount of Bitcoin, coinciding with Tesla's statement that it intended to buy $1.5 billion. This action significantly helped BTC reach a then-record high of almost $43,000.
Another Musk-led company, Tesla, experienced a similar growth pattern with its Bitcoin holdings.
The electric vehicle giant's financial reports for the second quarter of 2023 showed a retained BTC worth about $184 million, indicating the sale of nearly 75% of its initial $1.5 billion holding.
Despite the media hysteria around SpaceX's Bitcoin sale, the futures market seems to have been the primary driver of the price drop.
According to Coinglass's data, the market saw the greatest futures liquidation cascade since FTX's ascent, with BTC long liquidations amassing an astounding $386.68 million.
Traders blame Binance as naira crashes to N910 to a dollar, experiences worst performance under Tinubu
The exchange rate between the naira and the dollar fell as low as N910 to a dollar on the black market, according to Legit.ng earlier report.
Dealers quoted rates as high as N910 on Wednesday, August 9, 2023, as they continue to cite higher demands as the reason.
The Nigerian currency depreciated by 4.37% on the parallel market in the first week of August. The exchange rate dropped by 11.5% in the whole of July 2023.
Source: Legit.ng
