Bitcoin hits three-month low as Musk drives investors to exit

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(Changes in paragraph 1 “car manufacturer” to “car manufacturer”)

FILE PHOTO: The Bitcoin digital currency logo can be seen in a store in Marseille, France on February 7, 2021. REUTERS / Eric Gaillard / File Photo / File Photo

SINGAPORE (Reuters) – Bitcoin fell to a three-month low on Monday as investors sold cryptocurrencies after Tesla CEO Elon Musk hinted at the weekend that the automaker is considering or may have already sold some of its Bitcoin holdings.

Musk has fueled the crypto markets with his craze for the asset class, but recently messed up trading by appearing to cool Bitcoin in favor of his one-off parody Dogecoin. The twists are starting to frighten even steel traders.

Bitcoin fell more than 9% to $ 42,185 on Monday, its lowest level since Feb. 8, while Ether, which is linked to the Ethereum Blockhain, fell 8% to $ 3,227.22. Dogecoin fell nearly 7% to $ 0.48, and all three are well below recent records.

Last week, Musk said Tesla will no longer use Bitcoin as a currency because of environmental concerns about the energy it uses to process transactions. He defended that decision on Sunday, suggesting that Tesla may have sold its own holdings.

In response to an unverified Twitter account called @CryptoWhale that said bit.ly/2QsUQkw, “Bitcoins will beat themselves in the next quarter if they find out Tesla dumped the rest of their #bitcoin holdings. With the Amount of hatred is @elonmusk I wouldn’t blame him … “wrote Musk:” Indeed “.

It’s not clear if he was confirming sales or if he was just referring to the fact that he was exposed to criticism.

Last week, Musk said Tesla wouldn’t sell its Bitcoin, but the cryptocurrency has declined nearly a quarter since Musk reversed Tesla’s taking it as payment.

Dogecoin has also not fully recovered from Musk, who calls it a “hustle and bustle,” despite raising the price last week by saying it was working to improve its efficiency.

For an asset class that has soared this year, with Dogecoin up about a hundred times, Ether more than four times, and Bitcoin up 45%, some are starting to rule the time on the wild ride.

“Our weekend trading has started and we are looking at some serious liquidations on the exchanges,” said Chris Weston of brokerage Pepperstone in Melbourne.

“I’m closing the short bitcoin / long Ethereum trade and going on the sidelines as I feel the dust really needs to settle here,” he said.

(Changes in paragraph 1 “car manufacturer” to “car manufacturer”)

Reporting by Tom Westbrook in Singapore. Additional coverage from Radhika Anilkumar in Bengaluru and Vidya Ranganathan in Singapore. Adaptation by Gerry Doyle