Cryptocurrencies once again appear to be at the mercy of Tesla ((TSLA)) – Get Report founder Elon Musk’s commentary, as several of the top digital coins fell sharply Sunday afternoon following a tweet exchange by the electric car honcho.
While the cryptos were lower already, they appeared to slip dramatically after Musk wrote on Twitter “Indeed,” in response to a post by another user asking, “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…”
The ambiguous response appeared to spur the declines, which had bitcoin down 8.4% in 24 hours and ETH down more than 11%.
But those were built on earlier drops that also followed Musk’s abrupt criticisms of the electricity used in the digital “mining” of bitcoin — and reversing an earlier move to allow for vehicle purchases using bitcoin.
“To be clear, I strongly believe in crypto, but it can’t drive a massive increase in fossil fuel use, especially coal,” he wrote last week. It’s unclear why he had suddenly grown concerned about the use of energy in bitcoin mining.
Musk’s Twitter posts followed his appearance on “Saturday Night Live” last week that also moved dogecoin down, following some jokes on the cryptocurrency. They also followed Tesla‘s profiting from bitcoin, when it reported earlier this year that it had earned more than a $100 million from the sale of bitcoin it had purchased before. Tesla had bought $1.5 billion in bitcoin on Feb. 8.
But the cryptos have been highly volatile aside from Musk’s tweets and jokes, and were also headed down before Sunday.
Bitcoin is down nearly 24% over the past seven days, according to CoinGecko; ETH is down 13% on the week and dogecoin more than 20%.
ETH had just hit around $4,000 just about a week earlier, but last week technical analyst Helene Meisler wrote that ethereum “is not the sort of chart I would be attracted to. There are no measured targets left.”
Meisler had also earlier Tweeted a chart showing that new highs are not always bullish for bitcoin.
TheStreet‘s Bret Kenwell, meanwhile, said last week after bitcoin’s fall, that $58,000 to $60,000 appeared to be “stiff” resistance.
One thing is clear, however, bitcoin, which was valued at less than $10,000 a year ago, has been a wild ride for owners over the past month. The decline for bitcoin on Sunday brought it to levels near what was seen in April’s fall, when it tumbled below $48,000 for a time. Also in April, it had hit a high over $64,000.
This story has been updated.