Bitcoin slipped by more than US$1,000 after news broke that Tesla had sold the majority of its BTC holdings in Q2
The previous week or so went fairly effectively for the first cryptocurrency, which had dipped under US$19,000 on July 13 following the latest US CPI numbers. The bulls got here to play at that time and didn’t enable any additional declines. Just the other, Bitcoin started to realize its worth quickly and reclaimed US$20,000 earlier than the weekend. Saturday and Sunday noticed extra spectacular performances from the asset, which jumped past US$22,000. The panorama obtained even higher after the beginning of the working week. This culminated in a worth surge to over US$24,000, which turned the brand new highest worth level in over a month.
After several days of heading north, bitcoin slipped by more than US$1,000 after news broke that Tesla had sold the majority of its BTC holdings in Q2. The altcoins also retraced hard, with some massive declines from the likes of Cardano, Solana, Dogecoin, and others. This had an instantaneous impact on bitcoin’s worth, which dropped by roughly US$1,500 and at the moment struggles under US$23,000. Its market capitalization has dropped to only below US$450 billion, however, the dominance over the altcoins has regained some traction and sits at 42.6%.
BTC/USD has returned to consolidation after reaching highs of US$22,500 on Bitstamp. That level marked the beginning of sell-side positions on exchanges clustered around the 200-week moving average (WMA), a key area that analysts predicted would be difficult to crack. Not expecting Bitcoin to continue at this point, as it approaches the 200-Week MA and range resistance. Others, including fellow trader and analyst Rekt Capital, were skeptical of Bitcoin’s ability to maintain its upward momentum immediately.
The price of bitcoin fell about 1.7% to US$23,300 immediately following the release of the earnings report but rebounded to its previous levels after Musk made his comments on the earnings call. “As of the end of Q2, we have converted approximately 75 percent of our Bitcoin purchases into fiat currency,” said Tesla in a shareholder letter on Wednesday, as part of its company earnings report. “Conversions in Q2 added US$936M of cash to our balance sheet,” it said. Tesla ended the second quarter with just US$218 million in bitcoin (BTC), down from US$1.26 billion in the previous three quarters.
The company held about 42,000 bitcoin heading into the quarter. Bitcoin ended the second quarter at a price of about US$18,700, meaning Tesla avoided a substantial impairment charge on its holdings by selling earlier in the quarter. Elon Musk’s company further added that its Q2 year-on-year operating income and profitability were impacted by the impairment of Bitcoin. In Q1 2021, the statement from the company had shown cash flow from digital assets worth US$272 million.
On altcoins, Ether was still stealing the show, hovering near US$1,500 after reaching its highest levels in over a month, with massive gains against BTC included. ETH/USD was the darling of traders on the day, decisively upending the previously dire price action in place since May at the start of the Terra (LUNA) now called Terra Classic (LUNC) debacle. Upcoming resistance comes in the form of Ethereum’s previous Bitcoin halving cycle all-time high of US$1,530, which it reached in early 2018.