What is (Elon Musk and) Tesla’s Bitcoin strategy and its implications?

Amid the ongoing downtrend in the broader crypto market, old speculations regarding Tesla and Bitcoin have resurfaced. Immediately after another sell-off of the world’s largest crypto asset, Tesla’s self-proclaimed “TechnoKing” Elon Musk recently indicated that his company had not dumped any bitcoins.

Still, Musk’s electric vehicle company may have already done the unexpected, according to Liam Denning’s latest opinion piece in Bloomberg. He said,

“I’m really starting to believe that Tesla Inc. may have already sold some bitcoin this quarter. I know Elon Musk tweeted something else, but that’s not always rock-solid evidence. “

Obviously, April wasn’t a good month for Tesla, but May turned the tables for the company. As the company’s shares on Wall Street rebounded, Tesla’s market capitalization continued to bloat. Not to mention, Tesla’s sales in China also rebounded in May, giving the company a slight sigh of relief.

Nonetheless, Tesla’s new version of the Model S “Plaid +” has been canceled according to the latest announcement from Musk, and as a result, Tesla could come under pressure both up and down. According to Denning, this is one reason why a Bitcoin sale could continue to appear tempting for the auto company.

Bitcoin investor Preston Pysh recently claimed in a podcast that he was very skeptical that Tesla would even include Bitcoin on its balance sheet. He went on to explain why, he claimed,

“Simply because they don’t have the free cash flows that would warrant such a bold strategy.”

Nevertheless, Anthony Pompliano had previously forecast a likely scenario for Pomp Investments, in which he stated that Tesla was trying to tap a new customer segment from the Bitcoin mining space. Push agreed with investment strategist Lyn Alden’s stance, Push claimed that

“He [Elon] is a great figure in public life and learns in public. “

Additionally, Tesla’s Bitcoin value has fallen well below the average level the company invested $ 1.5 billion earlier this year, and if its China sales don’t deliver this month, it only makes sense to continue to expect the unexpected. According to CryptoTreasuries, Tesla holds 38,300 BTC, which was purchased at an average price of $ 34,700.

Source: Bloomberg

The well-known saying “Every action has an equal and opposite reaction” is even more applicable to the crypto market today thanks to Elon Musk. Every one of his Twitter actions was followed by remarkable price reactions in the charts. The “Elon effect” on the BTC price has obviously completely changed the dynamics of the market. Every “unwelcome” announcement by the Tesla manager has had a negative impact on the price of the king coin and vice versa.

That said, at press time, the coin had dropped 7.85% in the last week alone and was trading in the $ 34,000 area.

Source: Twitter

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