The Bitcoin (CRYPTO: BTC) hype train has taken a sharp turn away from destination moon and is hurtling back to earth.
The all-father cryptocurrency has experienced a ~30% selloff since its all-time high of US$64,899 on 14 April. This marks its largest correction since the March 2020 COVID-19 selloff where prices halved from US$8,000 to as low as US$3,800 within two days.
Image source: Getty Images
Why is Bitcoin sliding?
Last week, Tesla Inc (NASDAQ: TSLA) CEO Elon Musk (aka the "Technoking of Tesla") announced that the company would no longer offer Bitcoin as a payment option.
Musk's tweet said at the time:
We are concerned about rapidly increasing use of fossil fuels for Bitcoin mining and transactions, especially coal, which has the worst emissions of any fuel.
He also tweeted the recent surge in energy usage over the past few months with regards to bitcoin electricity consumption.
On a slightly positive note, the tweet said that:
Telsa will not be selling any Bitcoin and we intend to use it for transactions as soon as mining transitions to more sustainable energy.
Within two hours of the tweet, bitcoin crashed from approximately ~US$54,500 to as low as ~US$48,500.
Tesla exiting bitcoin speculation
More recently, there has been speculation that Tesla may have planned or already sold its bitcoin holding. A Twitter user who goes by the handle @CryptoWhale said:
Bitcoiners are going to slap themselves next quarter when they find out Tesla dumped the rest of their #Bitcoin holdings.
With the amount of hate @elonmusk is getting, I wouldn't blame him…
To which Musk replied, "Indeed."
A new cryptocurrency in town
Musk appears to have turned his back on Bitcoin in favour of meme-inspired, dogecoin. Dogecoin has suffered a similar ~30% correction from 8 May highs of US$0.739 to US$0.506 at the time of writing.
On 14 May, Musk tweeted:
Working with Doge devs to improve system transaction efficiency. Potentially promising.
Which again, witnessed a significant surge in dogecoin prices.
