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Does Musk have the strength to shake up investments in bitcoin and Twitter stock?

One day, billionaire Elon Musk’s electric car maker, Tesla, sells 75% of bitcoins it had bought and the crypto price drops. On the other, the currency begins to recover. After all, what is the real influence of the world’s richest man on the digital currency market?

In addition, Twitter just posted a $270 million loss. According to the social network, the reason for the loss is the failed purchase negotiation with the billionaire, who is the richest man in the world.

Yesterday, Thursday, barely a year after investing millions, an automaker-in the U.S. electric currency that sold the equivalent in Bitcoins 936 . The automaker has revealed in the past that it had $1.5 billion in cryptocurrency, when it reached a value of more than $340,000. The price of bitcoin has retreated and is now trading between R$120 and R$130,000.

The company’s CEO, Elon Musk, explained in China that against covid motivated the company to sell its digital assets and have more cash on hand to protect itself.

Why did Tesla sell bitcoins?

It may be for a reinforced box, as the automaker stated. But there may also be another reason, says Ayron Ferreira, head of analysis at Titanium Asset .

“The amount matches what he needs to pay in fines for undoing the Twitter purchase agreement,” says the analyst. In early July, Musk informed the social network that he would not

would take the purchase of Twitter forward for $44 billion. And he will have to pay a contractual fine of $1 billion.

Whatever the reason for the sale of the coins, following the disclosure, the bitcon price plummeted. The currency, which started the day at R$ 127,000, fell by R$ 123. But even the

midnight on Thursday had already recovered, reaching again R$ 127,000.

“This proves that bitcoin is a strong currency that is no longer so susceptible to Musk’s talk,” says Cassio Krupinsk , president of BlockBR, which trades digital currencies.

Can Musk influence the value of cryptocurrencies?

The fact is that – whether Musk or Amazon owner Jeff Bezos , or even Meta founder Mark Zuckerberg – the cryptocurrency market is always impacted when one of these personalities speaks on the subject.

But of the existing cryptocurrencies there are more than 2,000 of them, among them, some of them , are more well of some of them, just some of them . That is what bitcoin was developed yesterday. It rattles but is back on track, Krupinsk analyzes.

For Ferreira, what happened with the currency was actually a good thing. “Musk estimated that bitcoin has liquidity. That you need to sell, you are quick and on the spot,” he says.

So is it worth investing in bitcoin ? It can be a good thing, according to Marcio Loréga , chief analyst at PagBank . But since it is a market that fluctuates a lot, both up and down, it is best to invest an amount that will not be missed if the value of digital assets falls too much. “This is a very new market. We are seeing it grow. But it still needs a lot,” says Loréga.

According to him, it is more interesting to buy with the term in mind. So what happens to the digital currency’s share price when Musk says something gets diluted over the years

Twitter is another story not the only device of the world’s richest man. Twitter posted a $270 loss for the year’s quarter and says a second reason for the assessment is a failed deal with Musk.

The company also said it would not hold a conference call with investors about its results – something that publicly traded companies usually do with every share to keep their shareholders informed.

What is the problem?

The billionaire, who owns $228 billion, bought 9.2 percent of the social network’s shares in April and had intended to buy a platform for $44 billion.

About half of that, $21 billion, would come from Musk’s own pocket. However, he gave up on the purchase in early July . The company reacted by announcing that it will sue the entrepreneur to finalize an acquisition. The billionaire says he suspended the purchase because the company did not provide data on the number of fake accounts on the social network.

What was the damage to Twitter?

The costs of the negotiation have already been high for the network: $33 million. The social network’s stock has already done 22.9% with this story.

Is Twitter worth investing in?

The discount on the stock may make the investor believe that this is a good time to buy. But that is not what analysts say.

For future analyst Guilherme Zanin, from Avenue Capital, the problem is that Twitter’s stock became dependent on a single event, that of this negotiation. The fundamentals of the company, its investments – all this takes a back seat, far away. “When it happens, the risk of the asset a lot and I do not predict the future. I think it is difficult that it can happen,” he told UOL in early July when Musk started buying.

It is exclusively informational, not investment material. Risk applications abound. Past profitability does not guarantee future profitability.


Source: Uol Economia

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