London
CNN
—
The price of bitcoin has declined by nearly 9% since Thursday due to a broader sell-off of risky assets. Investor concerns were exacerbated by reports that Elon Musk’s Space X had sold off the cryptocurrency.
According to CoinGlass, a cryptocurrency trading platform, cryptocurrencies have experienced a total loss of $1 billion in the past 24 hours, with bitcoin accounting for nearly half of that loss.
Currently, the world’s most valuable cryptocurrency is trading at $26,327, which is 16% below its peak earlier this year in July, as reported by CoinMarketCap.
The sell-off on Thursday affected not only stock markets but also traditionally safe investments like government bonds. The sell-off was triggered by concerns expressed by officials at the US Federal Reserve about persistently high inflation, signaling a potential rate hike in the future.
According to The Wall Street Journal, SpaceX reduced the value of its bitcoin holdings by $373 million in 2021 and last year, and subsequently sold the cryptocurrency. This report caused a panic in the crypto market.
Hani Abuagla, senior market analyst at online broker XTB, stated in a note that the report about SpaceX’s actions sparked panic in the crypto market.
CNN reached out to Space X for comment on the situation, but there was no immediate response.
Elon Musk, who has been a strong advocate for bitcoin, initially announced that Tesla ((TSLA)) would accept bitcoin as payment in 2021 but later reversed that decision. Tesla also sold a significant portion of its own bitcoin holdings last year.
The crypto market has been under pressure from US regulators recently. In June, the Securities and Exchange Commission filed a lawsuit against Coinbase, the world’s largest crypto exchange, accusing it of acting as an unregistered broker. Coinbase has denied these allegations.
However, Coinbase received a crucial regulatory approval this week, allowing it to offer US-based investors access to crypto derivatives. These derivatives account for about 75% of global crypto trades.
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