Why Bitcoin CRASHED after Elon Musk’s Tweets!

I can’t believe I’m making this video. Elon 
Musk’s Tweet and the founder of Ethereum’s move   seems to have caused a downward turn of around 
300 billion dollars in a few hours according to   Forbes. From what I saw almost all the top gaining 
cryptocurrencies on the market went red dropping   about double digit percentages, this is an actual 
screenshot I took on Binance just some hours after   Elon Musk’s tweet. I’ll explain what this means 
and what I think could happen next. This is a very   critical point for crypto currencies and not just 
because of one person. Let’s talk about money. Hey what’s up guys, it’s Fisayo here and welcome 
to another episode of Finance Friday. Where I   take a pause from tech and talk to you guys 
about finance and the economy. If you’re new   to the channel, welcome, if you’re returning, 
welcome back. I’d appreciate it if you could   hit that like button if you eventually find this 
video useful or valuable in someway, by hitting   that like button you will definitely help other 
people discover this video and understand the   analysis we’re about to share.

Without 
#FodaAdu, let’s get to the video. The first thing we’ll talk about is Elon 
Musk’s tweet. Straight out the gate.   Elon Musk has been one of the biggest influencers 
for crypto currencies. First off Elon Musk, a very   successful person in his own niche, he’s the CEO 
of Tesla or as someone that likes memes a lot, he   calls himself the Technoking of Tesla.

He firstly 
announced in February of 2021 that his company was   buying 1.5 Billion Dollars worth of the bitcoin 
cryptocurrency. This was 2 months after he had   a discussion with Michael Salylor one of the 
Bitcoin Billionaires that’s also very bullish   on Bitcoin this was on Twitter. The aim was to 
put some of his company’s cash in assets that   makes sense and also that he hoped Tesla would 
accept payments for their cars in Cryptocurrency,   specifically Bitcoin. This was met with a ton 
of positive feedback. The bitcoin price rose   to a very new high, over 42,000 dollars from 
around 30,000, too put this into perspective,   if someone invested in a popular index fund on 
the stock market that grows 5 percent a year,   it would take them 6 years to gain that 
kind of money and this happened in a few   hours, people bought more to store their valuable 
cash and it was believed that Tesla made over 100   million dollars from that move. Elon Musk also was 
a major fan of Doge coin which has seen very new   highs and millionaires. It’s been around 4 months 
since that announcement in February was made and   just this week in May of 2021, Elon Musk says 
they have suspended accepting bitcoin payments   for Telsa.

Bruh. Only 4 months? The reason they 
gave was that they were concerned about rapidly   increasing use of fossil fuels to mine bitcoin. 
They stated that they won’t be selling any Bitcoin   and would probably look at other cryptocurrency 
using less than 1% of Bitcoin’s energy. Well as   you’d expect, this not so great news didn’t 
sit right with alot of people and it cause   the double digit drop in many cryptocurrencies 
and bitcoin tanked as much as 17%.

Ahhhh So what does this mean, first off, as at the time 
of making this video, things have sort of gone   back up but not as high as before. However, 
according to Forbes, as much as 300 billion   dollars was taken away from the crypto market and 
the market is said to be worth around 2 trillion. The reason is pretty simple as complex as 
it seems. The first thing to note is that   Tesla is an electric vehicle making company. The 
whole idea or most of it comes from the branding   perspective (or the look good perspective) 
that Tesla Is making the world a better place   by ensuring that we don’t use fossil fuels, like 
we exclusively do here in Nigeria and most of the   world.

Because it is better for the environment. 
Elon Musk is also the Chairman of SolarCity,   a company that wants to make most homes go 
the solar round for energy. So going Electric   and not using fossil fuels means our 
carbon footprint is low. However,   there are reports that the carbon footprint 
or amount of fossil fuels and energy used   in mining bitcoin is very enormous and it’s not 
good for the environment. Of course, this would   make a company whose goal among many others 
is to reduce carbon footprint look really bad.   This is the headline reason for why his tweet was 
made. To protect his company and the environment. Then there were critics that asked if he 
didn’t know this was the case before investing,   or if he’s intentionally manipulating the 
markets. There’s no answer to that unless you   ask Elon Musk himself. It’s very possible for an 
influential person like him to move the markets,   a critical example can be seen with Doge coin. 
His tweets and him constantly hyping up the doge   crypto makes the price go up and up and made a 
lot of people pour billions into the doge coin   market.

But there’s no use for Doge coin per se 
than just speculation. The founders or developers   of Dogecoin even didn’t put much thought into 
it and it’s generally regarded as a meme coin.   This meme coin has made alot of people rich 
and Alot of others, lose alot of money.   Now, when that tweet came along, Doge coin also 
fell really hard. The funny thing is Elon also   made a follow up tweet many hours later that 
he said he was working with Doge developers to   improve system transaction efficiency, this 
made Doge coin rise by some 30 percent.   Again, crazy how influential 
he has become over the market. We’ve seen cryptocurrency rise and fall like 
crazily. There was the historic crash from $20k   to $3k. It is very volatile and as much as you 
can gain, you can as well lose a whole lot so even   buying the Dip might not necessarily work out 
because you don’t know if that’s the dip in   itself.

Imagine those people who had it at 20k 
and it dropped to 10k, they. Might think that   that’s the dip only for it to go further down 
to 3k. This is why many governments have sort of   a trade at your own risk policy, Crypto is 
unregulated and not owned by 1 person and this   decentralized nature is one of the highest reasons 
for its appeal, unfortunately unlike traditional   stock markets that can get government bailouts 
or even deposit insurance when it crashes,   Crypto currency crashes leave the victims 
with nothing really. Some countries outrightly   ban it and here in Nigeria, the government has 
removed banks from participating in that sphere,   if you transact with cryptocurrency or you put 
it in the narration of your account.

You will   get flagged and your account will get blocked. I 
made a video about that and you can watch it with   the link in the description below. Another side of 
the spectrum that governments like Nigeria look at   it from is that fact that cryptocurrency, because 
it’s anonymous and not owned by one entity, it is   easy used to launder money or for fraudulent 
purposes, for instance, there was a report   that said people got gift cards illicitly and 
easy traded them for crypto which is kind of   like getting free money or also in worst case 
scenarios, scamming. This doesn’t negate the fact   that some countries suffer from bad exchange 
rate and difficulty to actually get good   investment programs or worse even access foreign 
exchange either for transfers or for payment.   Nigeria for instance is excluded on 
many payment platforms and we were   recorded as the second highest crypto market 
on Paxful Hence, crypto is just as valuable.

All of the risks associated with crypto currency 
has seemed to have been a little managed now or   have been a little less obliterating thanks to 
Institutional Investors coming in to the space,   billionaires like Elon Musk also adding a lot 
and cryptocurrencies being listed on many huge   exchanges and Visa giving people ATM cards for 
crypto. They brought legitimacy to crypto currency   and of course we see huge adoption and boom 
but it’s still very much in the early stages. The fact that Elon Musk’s Tesla has as much as 
1.5 billion invested could cause even higher   sell offs and drops in the market prices if they 
sell their holdings. Similarly, and speaking of   selling all holdings, the founder of Ethereum 
also did the same with a meme coin of a meme coin   can SHIB, according to Bloomberg, the Shiba 
Inu coin gave a $1 billion gift to which   he gave or donated to charities as a relief 
fund.

This made the coin go down 38%.   I saw that live and I can’t just imagine 
how much loss that would have been. In the end, one has to trade responsibly in these 
times. There’s Bitcoin which aims to replace   gold and act as a means of exchange, then there’s 
Ethereum which is more of a technological solution   and has even better use cases with NFTs, some 
other coins also have problems they’re solving so   it’s best to understand what you’re most 
likely investing in. Like I always say,   if it seems too good to be true, it probably 
is. My last video, the last finance Friday   episode talks about Ponzi schemes and this is 
how people can get scammed. The price is pumped   up to a really high level and everything just 
drops when many heavy investors or whales cash   out.

If you don’t understand the markets, 
you are better off saving your school fees   or children’s school fees and not investing 
in it, but if you’re interested you can learn   more about it. There are courses even about 
crypto currencies and what its value is. The   whole idea of cryptocurrencies is good because of 
the decentralization but the markets today seem   like they are more about people’s emotions. If you 
have to, learn and invest in what you understand.

That’s It from me this Friday, what are your 
thoughts about the cryptocurrency crash,   Elon Musk and do you have any questions 
for me? Leave them in the comments below.   Do hit that like button if you 
found this video useful and hit   that subscribe button + the bell icon beside 
it so you’ll be the first to know when I post   a new video. Thank you so much for 
watching and I’ll see you in the next one..

You May Also Like