Cryptocurrency Analysis

[IFX_Selena]

Tesla accepts bitcoin as payment causing cryptocurrency to rise again



On Tuesday and Wednesday, bitcoin failed to develop a corrective movement. The cryptocurrency was not able to test and break through the critical Kijun-sen line. Thus, the important support area formed by the Kijun-sen line kept BTC from heavy losses. In addition to this support zone, Elon Musk acts as a lifesaver for the digital currency.

As it became known yesterday, Tesla and its CEO Elon Musk continued to have a strong impact on the cryptocurrency market. Earlier, Elon Musk repeatedly commented on bitcoin, and Tesla invested heavily in it. This time, the company has announced that its customers can now buy electric cars with bitcoin. This option is already available to US citizens and will become available outside the United States later this year. Thus, this is another piece of news which seeks to promote bitcoin among private market participants as well as large institutional investors. After all, this is exactly what Tesla is. Moreover, according to rumors, Elon Musk owns $5 billion worth of BTC. Naturally, the market's reaction to the news from one of the top US newsmakers is always strong. Thus, this announcement also led to a 5% bump in the price of bitcoin. Meanwhile, we are once again forced to state a rather paradoxical and sad fact. In order for bitcoin to gain in value by 5-10%, no important market or fundamental factors are needed. A tweet from Elon Musk or news from Tesla is enough. Thus, bitcoin can rise in price forever. All we need for "infinite growth" is Elon Musk to comment on the digital currency once a week and Tesla to expand its interaction with the crypto sphere and purchase bitcoin from time to time. Apart from that, there is Space X. I wonder how traders and investors will react to the news that the company that launches spacecraft and is planning round-trips to Mars is investing in bitcoin.

By the way, the statement of the head of Tesla is equally important for the future dynamics of bitcoin. Musk said that bitcoin paid to Tesla would not be converted into traditional currency. This means that the company is not afraid of the cryptocurrency's ups and downs, and it would adhere to the 'digital gold' stabilization policy in order to use it not only as a means of investment but also as a medium of exchange and a store of value.





Paolo Greco
Analytical expert
InstaForex Group © 2007-2021