When Elon Musk speaks, bitcoin investors listen.
The Tesla chief executive’s often-cryptic messages have sent bitcoin’s price on a roller-coaster ride this year. Prices soared nearly 20% one January morning when he added “#bitcoin” to his Twitter biography. They jumped 16% in a single day the following month after Tesla Inc. revealed it bought $1.5 billion worth of the cryptocurrency.
Then, he tweeted earlier this month that Tesla would no longer accept bitcoin as payment for its vehicles. Investors widely blame the tweet for starting bitcoin’s most punishing selloff of the year, a rout that has shaved hundreds of billions of dollars off its market capitalization and has erased gains made since late January. After peaking in mid-April near $65,000, bitcoin prices have fallen some 50%, including roughly 40% since Mr. Musk’s May tweet.
Bitcoin’s wild price swings continued over the weekend. The digital currency fell as low as $31,179.69, according to CoinDesk, down from $35,263 as of 5 p.m. Friday.
Many investors were happy to dismiss Mr. Musk’s tweets as harmless noise on the way up. Some investors, particularly newer entrants to the market, even celebrated the fact that Mr. Musk was voicing his support for bitcoin.