Bitcoin Price Shoots Past $38,000 on Elon Musk’s Endorsement
Elon Musk has changed its Twitter bio to one word: Bitcoin.
The billionaire entrepreneur, whose opinion of the benchmark cryptocurrency has juggled between skepticism and praise, appeared to have taken a definite stance about it. In a tweet that followed shortly after the bio update, Mr. Musk said that “in retrospect, it was inevitable.”
That was enough for Bitcoin bulls to take charge in an otherwise short-term bearish market. Mr. Musk’s tweet propelled them to raise their bids for the cryptocurrency. As a result, in just two hours, the cost to purchase one Bitcoin climbed from nearly $32,000 to above $38,000.
In retrospect, it was inevitable
— Elon Musk (@elonmusk) January 29, 2021
Bitcoin on Tesla’s Balance Sheet?
Mr. Musk’s cryptic tweet and bio prompted theories about the possibility that his firms Tesla and SpaceX would add Bitcoin to their balance sheets. Meanwhile, many took it as an open-air advertisement for the world’s largest cryptocurrency to Mr. Musk’s 43.8M followers, many of whom include notable crypto skeptics such as Nouriel Roubini and Peter Schiff.
“Fact is we don’t know if Elon Musk adding Bitcoin to his Bio means something,” alerted Alex Krúger, an independent market analyst, nevertheless. “We must wait for that. However, everyone is now thinking about Tesla adding Bitcoin to its balance sheet. Which would be massive. The possibility alone is enough to send the market roaring.”
Bitcoin tends to react positively to high-profile mentions. Recently, JPMorgan’s $100,000 Bitcoin price prediction last year prompted the cryptocurrency’s price above $35,000 for the first time in history. Similarly, PayPal’s decision to add Bitcoin services helped it close above its previous record high of $20,000, which remained unachievable since December 2017.
Bitcoin breaks above the 20-day moving average to signal an extended bullish bias. Source: BTCUSD on TradingView.com
But Mr. Musk’s tweet also came at a time when his so-called favorite cryptocurrency, Dogecoin, was returning to the bearish side after climbing 1,100 percent in just two days. It is difficult to assume whether Mr. Musk is trolling Bitcoin or promoting it—partially because Dogecoin is a joke cryptocurrency.
In either way, the flagship cryptocurrency was able to break out of its two-week downside bias with Friday’s rally. The wild move upside also helped it break above its 20-day moving average, pointing to an extended bullish move in the sessions ahead.