Bitcoin prices dropped over 8 percent on May 18 after Tesla chief Elon Musk's latest Twitter exchange sparked speculation that the electric carmaker may have dumped or is planning to dump its entire bitcoin holding.
A Twitter user who goes by @CryptoWhale said, "Bitcoiners are going to slap themselves next quarter when they find out Tesla dumped the rest of their holdings. With the amount of hate @elonmusk is getting, I wouldn’t blame him…"
Musk replied, "Indeed."
Following the tweet, bitcoin prices fell sharply to $44,000, its lowest levels since February 2021. At the time of writing this copy, bitcoin was trading at $44,055, down 8.39 percent. It touched an intraday high of $49,814.01 and an intraday low of $43,837.43.
In March, Musk said Tesla customers can buy its electric vehicles with bitcoin. The company also purchased $1.5 billion worth of bitcoins, however, the carmaker sold 10 percent of its holding just a month later to prove the cryptocurrency's liquidity as an alternative to cash.
Last week the automaker announced that it had suspended the use of bitcoin to purchase its vehicles, citing concerns about the use of fossil fuel for bitcoin mining.
"Cryptocurrency is a good idea on many levels and we believe it has a promising future, but this cannot come at great cost to the environment," Musk had said.
He reiterated his bullishness on crypto and said the company was looking at alternatives to bring down the environmental cost.
"We are also looking at other cryptocurrencies that use <1 percent of bitcoin's energy/transaction," Musk said.
The maverick businessman also said he was working with developers of Dogecoin, a meme-inspired cryptocurrency, to improve the efficiency of transactions.
"Working with Doge devs to improve system transaction efficiency. Potentially promising," the Tesla chief executive tweeted.