Tesla’s Bitcoin Announcement Turns Negative for Cryptocurrency Market

Elon Musk, CEO of Tesla, announced yesterday that cryptocurrency users can buy Tesla products through Bitcoin. While the news was positive for the adoption of BTC, the world’s largest cryptocurrency lost nearly 5% of its value in the last 24 hours.

According to the latest data published by Coinmarketcap, the total market cap of Bitcoin has dropped below $1 trillion for the first time in 7 days. As of writing, the total market cap of cryptocurrency assets stands at around $1.63 trillion, which is down from $1.78 trillion yesterday.

Ethereum, the world’s second-largest cryptocurrency, dipped below $1,600 for the first time in nearly 2 weeks. ETH is currently trading near $1,590 with a market cap of nearly $180 billion. The cryptocurrency is down by more than 15% in the last 7 days.

Elon Musk announced yesterday that Tesla products are available for purchase through Bitcoin. The electric-car maker revealed a $1.5 billion BTC investment in February. The CEO of Tesla added that the company is not planning to convert Bitcoin into a fiat currency.

“Tesla is using only internal & open-source software & operates Bitcoin nodes directly. Bitcoin paid to Tesla will be retained as Bitcoin, not converted to fiat currency,” Musk said on Twitter.

Musk and Cryptocurrency Market

Musk remained vocal about Bitcoin and other cryptocurrency assets on social media platforms. During a conversation on an invitation-only audio-chat social networking app, Clubhouse, the CEO of Tesla said that Bitcoin is on the verge of mass adoption. Despite all his optimistic views and a profitable Bitcoin bet, Musk saw a dip in his overall wealth during the last 2 months. At the time of Tesla’s announcement of a $1.5 billion investment in Bitcoin, the company’s stock (TSLA) was trading at around $850 with a market cap of nearly $800 billion. As of writing, TSLA is trading near $630, which is down approximately 25% in the last 7 weeks.

The world’s largest cryptocurrency Bitcoin currently has a market cap of $990 billion.