Bitcoin jumps 10% after hitting its lowest level in about 2 months as buyers swoop in after the price drop

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Bitcoin rose as much as 10% on Monday, as investors used last week’s slide as a buying opportunity.

The digital asset was last trading near $53,000 as of 03:00 a.m. ET, but had earlier dropped as low as $47,000 in early Asian trade.

Some analysts said crypto investors view volatility as a good chance to rack up profits. Real Vision co-founder and former hedge-fund boss Raoul Pal said Sunday: “Corrections in a bull market are opportunities and not threats.”

Bitcoin had tumbled to as low as $47,953 last week after JPMorgan warned there could be further weakness for the cryptocurrency due to a decline in buying momentum. Reports that President Joe Biden plans to impose higher taxes on the rich also propelled a wider drop in bitcoin. Investors in Turkey were dealt more pain after the collapse of two crypto exchanges, stoking concern that cryptocurrencies may be in a bubble.

“My feeling is that the market is long and wrong above $60,000 of fiat currency, backed by tax-payer revenue, US dollars,” Jeffrey Halley, a senior market analyst at OANDA, said, adding he expects the price to fall to around $42,000 based on technical analysis.

Popular crypto influencer and Tesla billionaire Elon Musk posted yet another cryptic reference to the market. He tweeted over the weekend “What does the future hodl?” – using a term crypto investors understand standing for “hold on for dear life” with respect to their holdings.

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Bitcoin enthusiasts will be paying attention to Tesla’s first-quarter results, set to be published after the market close on Monday, for any insight into crypto in general, or the company’s bitcoin holdings.

Meanwhile, Cardano’s ADA token rose 10% to $1.20, Ethereum’s ether rose 6% to $2,457, and Dogecoin rose 5% to $0.26.

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Elon Musk defends Tesla’s $1.5 billion bitcoin bet as ‘adventurous enough’ for a S&P 500 company – and says it’s less dumb than holding cash

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Elon Musk.

  • Elon Musk defended Tesla’s bitcoin bet as “adventurous enough,” rather than also holding Dogecoin.
  • Musk was responding to Binance CEO Changpeng Zhao, who called out Tesla’s move in a Bloomberg interview.
  • Zhao said he was surprised that Musk is a Dogecoin advocate, given that it was created as a joke.
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Elon Musk defended Tesla’s $1.5 billion bitcoin bet after the CEO of major cryptocurrency exchange Binance called out the billionaire’s support for meme-based token Dogecoin. 

“Having some Bitcoin, which is simply a less dumb form of liquidity than cash, is adventurous enough for an S&P500 company,” Musk tweeted in response to a Bloomberg interview with Binance CEO Changpeng Zhao.

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Tesla made its biggest bitcoin endorsement yet by announcing not just its significant investment, but also that it plans to adopt the digital asset as a form of payment for its products. 

In the interview, Zhao said he was surprised that Musk is a Dogecoin advocate, given that it was created as a joke. Musk has fired off several tweets about the Shiba Inu-themed token, sparking a surge in its price. Last week, he said he bought some for his 9-month-old son.

“I strongly believe that he’s not really associated with Dogecoin in any way,” Zhao said of Musk, noting that Tesla’s bet was on bitcoin, and not on the “joke” asset. But Binance has added Dogecoin futures recently based on consumer demand. That’s because it’s gaining popularity for reasons nobody expected, Zhao said.

Zhao’s comments elicited a response from Musk, in which he explained the reason behind Tesla’s move.

“When fiat currency has negative real interest, only a fool wouldn’t look elsewhere,” Musk tweeted. “Bitcoin is almost as bs as fiat money. The key word is “almost”.”

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Other Wall Street names seem to be embracing bitcoin too, driving the token’s price higher to an all-time high above $52,000. As bitcoin surges to record highs, Zhao said Binance is seeing more than 300,000 new user registrations on a daily basis. The exchange last saw such remarkable levels during bitcoin’s 2017 boom, but volumes are even higher now.

“There’s a lot more activity now in this industry than three years ago,” said Zhao. “We are just at the beginning.”

Bitcoin’s rally extended on Friday as it rose 2% to trade around $52,740 as of 9:40 a.m GMT.

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