Palo Alto’s Tesla’s Musk says Bitcoin overvalued as digital coin drops 25% market cap

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Palo Alto’s Tesla’s Musk says Bitcoin overvalued as digital coin drops 25% market cap

Less than a couple of days after the Tesla Inc. boss Elon Musk had tweeted that Bitcoin’s price seemed slightly overvalued, the world’s largest digital asset that had touched a market capital of more than $1 trillion for first time on record later last week, shrugged off a fourth of its market valuation over the past two sessions, while on Tuesday’s market, Bitcoin, the original cryptocurrency was last trading nearly 15 per cent lower to $46264.1 after digesting a hefty header of 10 per cent a day earlier.

On top of that, a latest leg of steep downward spiral in bitcoin’s valuation weighed heavily on Tesla Inc shares, slicing more than $100 billion off the deck in the e-vehicle manufacturer’s market value while shaving off nearly $20 billion of Elon Musk’s personal worth.

Notably, Tesla Chief Elon Musk had invested as many as $1.5 billion in bitcoins a week earlier.

Bitcoin totters as ETFs holding Tesla stocks slump

Aside from that, with a downturn of as much as 25 per cent over past two sessions, Bitcoin had tuned up the tone of a broad-based weakness in crypto markets, while many investors were reportedly quitting their leveraged bets as Tesla stocks wrapped up the day more than 1 per cent lower to $704 apiece after shedding roughly 7.3 per cent to $662.3 in pre-market trading.

A widespread weakness in Tesla Inc. had also been spilled over the ETFs (Exchange Traded Funds) such as ARK Innovation ET alongside ARK Autonomous Technology and Robotics ETF, both of the which were down by 8.3 per cent and 7.3 per cent respectively.

Meanwhile, questions were raised on whether Tesla Inc.’s $1.5 billion in investment on crypto assets could backfire now with traders taking their chips off the table.