Following this massive Monday plunge, Tesla’s stock price fell dramatically on Tuesday, wiping $15 billion off CEO Elon Musk’s net worth. Tesla, the almighty electric-car maker on the market that has been the hottest one for over a year, has sunk into the bear market territory.
So what happened? Well, everything ties up with Tesla’s earlier announcement that I made this month. The company has invested $1.5 billion in bitcoin due to a decision to put in a portion of cash in certain specified alternative reserve assets.
The announcement shook the crypto world to the core. As a result, it has BTC ad other cryptos a fresh dose of legitimacy. The price of BTC was up 12% in morning trading on the news. Meanwhile, shares of Tesla were up 2% in early trading. Well, unfortunately, it’s all in the past now…
Who is to blame? You may wonder, and there is no one but Elon Musk to blame as he was a very important instigator; Tesla’s stock tanked after his Saturday tweet declaring that bitcoin’s prices seem too high.
Let us remind you that Elon Musk’s eccentric tweets are nothing new to the community. As quite recently, his single tweet about a meme base coin. The so-called, DogeCoin was pumped up by a sudden surge.
What will happen next?
Well, as Shares of Tesla (TSLA) fell 6% Tuesday after closing 8.5% Monday, wiping out its gains for the year. It also knocked CEO Elon Musk into the second position in the richest person on the planet list, behind Amazon founder Jeff Bezos.
Also, from now on, there are some speculations that Tesla’s stock may be heavily tied to the fate of bitcoin. Bitcoin has declined by more than 20% from its recent high, and Tesla shares have fallen more than 20% since it announced it purchased bitcoin on February 8.
Experts say that on a global crypto level, the market is trying to balance itself after a huge resurgence of Bitcoin. Things may come back to normal after BTC calms down and stops its insane volatility.