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The price of bitcoin plunged 17 per cent on Monday after hitting a record high of $74,019.31 on Sunday.
The volatile cryptocurrency fell to $65,204.59 before regaining ground. At 7.30am AEDT it was valued at $68,676.84.
The slide came just hours after billionaire Elon Musk tweeted that bitcoin and Ethereum “seem high”.
RELATED: Bitcoin’s market value hits $1 trillion for first time ever
The comment comes after Tesla invested nearly $2 billion in the cryptocurrency. The company has already racked up about $1.26 billion in profits from that investment.
The Tesla CEO’s tweets have previously impacted markets — a comment about the Tesla stock price sent it plummeting in May 2020.
A joke about dogecoin saw its value almost double.
“Elon and his fleet have incredible power over market prices,” founder of Quantum Economics Mati Greenspan said.
He predicted there would be “increased volatility going forward” for bitcoin.
There is also growing concern that bitcoin is entering bubble territory.
In 2017 the price of bitcoin dropped 45 per cent after hitting new highs. The cryptocurrency grew by 305 per cent in 2020.
Barclays Wealth & Investments CEO Will Hobbs told Insider that he was avoiding the cryptocurrency because of its wild swings.
Newly-appointed US Treasury Secretary Janet Yellen said at a press conference on Monday that bitcoin was an “extremely inefficient way of conducting transactions.”
But bitcoin is continuing to gain institutional support.
On February 9, Tesla said it would begin accepting bitcoin as payment for its cars and other products in the near future. In October last year, PayPal announced it would allow consumers to conduct transactions in cryptocurrency.
Payments company Square also said it would invest $50 million in bitcoin.
American investor and founder of Gemini cryptocurrency exchange Tyler Winklevoss said the story of bitcoin had always been “two steps forward, one step back, then two steps forward”. “Few understand this,” he wrote on Twitter.
As the price hit record highs on Sunday, the mysterious — and presumed founder of bitcoin – Satoshi Nakamoto, became one of the world’s richest men.
Satoshi Nakamoto is the name used by the presumed pseudonymous person or persons who developed bitcoin. And if he does exist he’s rich, very rich.
Satoshi is believed to have set himself aside one million coins when the cryptocurrency was created.
That would have put his net worth at $74 billion. But those one million coins have never been touched.
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