What if Elon Musk’s sell-off was just a blessing for Bitcoin?

At the end of July, Tesla, the company led by Elon Musk, disclosed in its financial report for the second quarter of 2022 that it had sold 75% of its Bitcoin position, valued at 1.5 billion. A news that for the good of BTC holders has not had any negative effects on the price of the asset. On the contrary, the asset seems to be showing quite remarkable signs of resilience since the announcement. So, would Tesla’s sell-off indeed be a blessing for Bitcoin?

Since the crypto winter of 2018, Bitcoin and other cryptocurrencies have not seen such a bearish period as April to June. The price of BTC had even ended up falling towards $17,567. Data shows that many investors, especially small holders, sold part or all of their investment during this period. Among these weak hands is a rather surprising name, Tesla, which held the equivalent of 1.5 billion in Bitcoin in its wallet.

The billionaire’s company therefore sold 75% of its BTC holdings between April and June. And, according to statements made by Musk during the annual conference with Tesla shareholders held on August 5, this bitcoin liquidation ratio has reached 90%. If the facts of the capitulation date back to the second quarter, the information was communicated at the end of July. But the latter had no effect on the price of Bitcoin.

The Musk effect is starting to become less of a burden on Bitcoin

In May 2021, Tesla announced the suspension of car purchases in Bitcoin in parallel with the Chinese crashdown and thus dragged the asset into a downward channel. This time, news of Tesla’s capitulation of over $1.12 billion in BTC didn’t shake Satoshi’s coin at all. The asset maintained the month’s trend until reaching a 60-day high of $24,666.

Some thought that the sell-off of the electric car giant would put a stop to the July bull run. This was ultimately not the case as the asset closed the month with a growth of 21.4%, its best monthly performance since October 2021. Musk, who once had an influence or a stranglehold on the crypto market, although more than an exit from the Fed or the ECB now has no real control over digital assets.

In fact, his post where he revealed he’s counting his Doge tokens “hodl” went like a letter in the mail in the industry.

Let’s go with the believers

Tesla is one of the rare top holders to liquidate its position because the tendency is rather towards accumulation among the latter. Despite a loss of 918 million, MicroStrategy has indicated that it still intends to keep its reserve in Bitcoin. The company formerly headed by Michaël Saylor even allowed itself luxury to buy 480 new Bitcoin at the end of June, in the middle of the bear market.

In reality, Musk has never been a big fan of Bitcoin, although he has sometimes shown signs of recognition for this cryptocurrency. He never enjoyed it the way he enjoys his coin meme, Dogecoin. The liquidation of Tesla’s position is proof of this. His withdrawal from Bitcoin through the token sell-off is not necessarily a bad thing as there was too much uncertainty about Musk’s real support for the cryptocurrency universe and more specifically for BTC.

So Bitcoin may have gotten rid of a weak hand that could ruin a nice uptrend in the future. We recognize all the same that at the time of the capitulation, the price of Bitcoin suffered a little but it was a period when the asset was only slapped. The bottom may also have passed for Bitcoin. The asset can now hope to grow without the risk of a big capitulation.

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