.png){kind=logo}
It is now well-known among crypto investors and the highly volatile cryptocurrency market about the hard crypto downtrend of Bitcoin (BTC). Being the most popular and number one crypto in the market, Bitcoin is most favorite of Elon Musk, CEO of Tesla and SpaceX. Elon has mentioned that Tesla has had billion dollars worth of Bitcoin holding since the beginning. But the recent drastic crypto downtrend is creating financial issues for Elon and Tesla with the increasing rate of decreasing Bitcoin price in May-June 2022. Thus, Elon is scared of the further crypto downtrend of Bitcoin to incur more losses in his crypto wallets in the 3rd quarter of 2022.
The crypto downtrend is continuing since the major crypto crash of stablecoins, Tether and Terra, along with Bitcoin and Ethereum. Tesla just invested in Bitcoin with a US$1.5 billion crypto holding in February 2022. BTC tokens reached US$68k in November 2021 but plunged to US$19k in June 2022. At the time of writing, the current price of the BTC coin is US$20,111.29 with a market cap of US$383.85 billion and a volume of US$28.30 billion.
The Bitcoin holdings of Tesla have lost around 33% with an impairment loss of more than US$400 million in the second quarter financial report. Now, Elon is getting scared of the crypto downtrend because Tesla has started incurring million dollars losses in the crypto market. Elon calculated that Tesla and its Bitcoin investment has dropped to US$820 million for the highly fluctuating BTC price in recent times.
Elon is experiencing huge losses in the crypto bloodbath while there is an increase in selling-off pressure from other crypto investors. There is part of Tesla's cash reserves that were shifted to cryptocurrency or BTC holdings for the rising power of Bitcoin at that time. But the smart decision has disappointed Elon and his team at Tesla. Bitcoin started to experience the historical crypto downtrend, especially May-June 2022 reaching the US$17k zone. Tesla is ready to take a writedown of US$440 million on its investment in the crypto market.
Yes, there are multiple reasons for this Bitcoin crypto downtrend such as high inflation, looming recession, the freezing decision of Celsius Network, pandemic, Russian-Ukraine war, and other extreme market conditions. Still, Elon was confident and decided to stick with Bitcoin. Meanwhile, Elon Musk is not the only victim of the crypto downtrend, multiple companies such as MicroStrategy, Block Inc, and many more have started suffering the consequence of investing in Bitcoin.
Join our WhatsApp Channel to get the latest news, exclusives and videos on WhatsApp
_____________
Disclaimer: Analytics Insight does not provide financial advice or guidance. Also note that the cryptocurrencies mentioned/listed on the website could potentially be scams, i.e. designed to induce you to invest financial resources that may be lost forever and not be recoverable once investments are made. You are responsible for conducting your own research (DYOR) before making any investments. Read more here.
