Bitcoin crashes to $42,000 after Elon Musk tweet-storm - but rebounds after he clarifies Tesla hasn't sold its holdings

Bitcoin plunged to as low as $42,185 on Monday, down 35% from April's record high, before rebounding.
The price tumbled after Elon Musk suggested Tesla may sell its holdings and trolled bitcoin fans.
Yet bitcoin climbed back above $45,000 after Musk said Tesla had not in fact sold its stake.
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Bitcoin plunged to its lowest level since February on Monday after Elon Musk suggested Tesla might sell, or had sold, its holdings, only to rebound somewhat when the billionaire clarified his electric car company still held its stake.

The world's most-traded cryptocurrency plunged to $42,185 at one point on Monday morning, after Musk replied "Indeed" to a Twitter post that said: "Bitcoiners are going to slap themselves next quarter when they find out Tesla dumped the rest of their #Bitcoin holdings."

That was the lowest level since February 8 and 35% below the all-time high of close to $65,000 reached in April.

But bitcoin then rebounded somewhat when Musk tweeted: "To clarify speculation, Tesla has not sold any Bitcoin." The token was down 7.5% at $45,529 at 4.40 a.m. ET.

Bitcoin has fallen sharply in recent days after Musk - previously one of its biggest cheerleaders - appeared to turn his back on the cryptocurrency.

The slide started on Wednesday when Musk tweeted a note saying that Tesla would stop accepting bitcoin as payment for its electric cars, saying the token's "insane" energy use was damaging to the climate.

Musk's announcement shocked crypto fans and sparked a broader sell-off in cryptocurrencies including ether, dogecoin and XRP.

His suggestion on Sunday night that Tesla had sold, or might sell, its bitcoin stake, which it bought for $1.5 billion in January, caused panic among investors in the token.

The Tesla boss has been one of the central drivers of the bitcoin boom. The electric car company selling its stake would be a major blow to the legitimacy of the digital asset.

Musk spent the weekend arguing with and trolling bitcoin fans on Twitter about its energy use and structural flaws.

"Bitcoin is actually highly centralized, with supermajority controlled by handful of big mining (aka hashing) companies," he tweeted on Sunday night.

"A single coal mine in Xinjiang flooded, almost killing miners, and Bitcoin hash rate dropped 35%. Sound "decentralized" to you?"

He also continued to suggest Tesla was looking at accepting dogecoin - a cryptocurrency started as a joke in 2013 - as payment for its cars, saying doge would win "hands down" if it sped up its blockchain network.

Read the original article on Business Insider