Mohamed A. El-Erian, the chief economic advisor for Allianz, an asset management and insurance firm recently appeared on CNBC’s Squawk Box, where he talked about Fed’s recent meeting, Bitcoin and Elon Musk. The chief economic advisor said Bitcoin is currently in a tug-of-war between regulation and adoption. He said Elon Musk, the Tesla CEO has a huge impact on the adoption side.
— Squawk Box (@SquawkCNBC) June 14, 2021
El-Erian pointed towards today’s Bitcoin price gain of over 10% post Musk’s Tweet about the top cryptocurrency.
Musk while responding to an allegation of pumping and dumping the Bitcoin market reinstated that Tesla has only sold 10% of its $1.5 billion purchase and willing to reconsider Bitcoin payment for the car purchase if Bitcoin mining becomes greener.
El Erian said,
” Musk has a huge impact on the adoption side, first he said Tesla would accept Bitcoin as a payment implying it is a “currency,” then said he is not sure and today he again hinted at using it as a form of payment.”
Musk has quite a love-hate relationship with Bitcoin, where he first became a Bitcoin hero after Tesla revealed its $1.5 billion bitcoin purchase and later also announced they would accept BTC as payment. However, just a few later Tesla withdrew its plan claiming environmental concerns. The decision received heavy backlash from the crypto community that started a tweet war between the two sides.
Musk’s Tweet a Crypto Market Mover
Elon Musk is known for the outrageous and obnoxious tweets, however, it is not new and his tweets have also led to price volatility in Tesla stocks in the past as well. Earlier he was called out for his continuous pumping of the Dogecoin meme currency that brought him close to getting an SEC notice.
While mainstream media often point out the drastic impact of Musk’s Tweet on the crypto market, they fail to mention a similar impact on stock markets.