Crypto price – live: Bitcoin crash halted after Elon Musk says Tesla has ‘diamond hands’

If you’ve got any questions about this chaotic crypto market crash, we’ve assembled two experts to provide their analysis and answer any queries you may have.

Joining us tomorrow morning will be Dr Iwa Salami, a senior lecturer in financial law at the University of East London, and Fred Schebesta, a crypto advocate and founder of the comparison platform Finder.com – which recently surveyed dozens of academics and market analysts for its April/ May 2021 Cryptocurrency Predictions Report.

They will give readers of The Independent an opportunity to ask anything they like about bitcoin and the crypto space: Was this crash expected? Is it a repeat of 2017? And what are their predictions for where it will go from here?

You can find out more about it here, and add any questions you have in the comments below the article.

The last time the price of bitcoin dipped this severely was in March 2020, when the full implications of the Covid pandemic where beginning to be realised.

At that time, bitcoin dropped briefly below $4,000, as global financial markets took a pummelling from the prospect of prolonged lockdowns and the economic shutdowns that would come with them.

The crypto market crash at that time prompted many to speculate that it may actually be a good time to buy bitcoin, with even famed whistleblower Edward Snowden suggesting that bitcoin was oversold.

This sentiment is one shared by Pete Humiston, manager of Kraken Intelligence, who tells The Independent that investors may well take advantage of the market disruption to “buy the dip”.

He says: “The last time bitcoin was this oversold was in March 2020. But crypto has had a breathtaking run over the past couple of quarters, so a strong pull back and consolidation now isn’t surprising – it’s what we’ve seen in all other previous bull markets.”

Various cryptocurrency experts and market analysts that we’ve heard from so far today have been divided over whether this current crash is of a similar magnitude to the one bitcoin experienced at the end of 2017, or just a price correction on the way to new record highs.

With bitcoin’s fate still hanging in the balance, we’ve heard from two new voices who side firmly with the latter of those two options.

Here’s what Ganesh Swami, CEO and co-founder of blockchain data provider Covalent, and Antoni Trenchev, co-founder of the financial institution Nexo, had to say:

Bitcoin has returned back above $40,000! That’s a considerable bounce after dropping as low as $30,681 earlier today.

The rebound appears to have coincided with Elon Musk’s “diamond hands” tweet, meaning the Tesla CEO potentially both single-handedly started and ended this market downturn.

It’s too early to say whether we’re actually through the worst of it, of course, but bitcoin is back above the level it was at before that panic-induced flash crash.

The next few hours could prove crucial in determining the longer-term trajectory of bitcoin and the broader cryptocurrency market.

But what does it mean? Quite a lot, actually.

Elon Musk, who many blame for starting this market-wide collapse, has just tweeted that Tesla will not be selling its substantial crypto holdings.

Tesla’s “diamond hands” will be a strong signal to institutional investors that the electric car maker is in it for the long haul. If Tesla was to sell now, it would be doing so at a loss.

Musk fist announced that Tesla had invested $1.5 billion in bitcoin in February, while simultaneously revealing that it would begin accepting payments with the cryptocurrency. Backtracking on the latter part of this announcement last week sparked a major sell-off, which continued over the weekend and through to this week.

His tweets have moved markets before – maybe this is what’s needed to arrest the slide?

One of the founders of dogecoin has offered his advice to anyone looking for predictions about where the cryptocurrency market goes from here.

Dogecoin has lost nearly a third of its value during this latest crash, and more than half its value since its all-time high earlier this month, but despite these losses it is still up more than 8,000 per cent since the start of the year.

Billy Markus, who co-founded dogecoin in 2013 alongside Jackson Palmer, has just tweeted his “complete rules of crypto price prediction”. It’s surprisingly simple:

Cryptocurrency prices are at their lowest since the start of the year. While some are cashing out in case it falls further, others are hoping this might be a great buying opportunity.

A number of major cryptocurrency exchanges appear to have crashed.

This wouldn’t be the first time that a price fall has caused trading platforms to struggle, however it does seem more widespread than any previous occasions.

Website health monitor DownDetector recorded issues with Binance, Coinbase, Gemini and KuCoun, while online banking apps like Revolut also seem to be hit by the outage.

Typically, some users are complaining that they can’t cash out their holdings, while others claim to be frustrated that they cannot “buy the dip”.

Bitcoin has fallen further over the last hour, reaching below the $35,000-$38,000 resistance and is now heading towards $30,000. Bitcoin is currently trading at around $31,500 – but in the time it took to write that last sentence it had fallen by another few hundred dollars.

The more the price falls, the more comparisons will be drawn to the Great Crypto Crash of 2017/18. It may be a bit early for the four year cycle to be coming to an end, but the level it has fallen is now very familiar: More than half of bitcoin’s value has now been wiped away since its all-time high in mid April.

Clem Chambers, CEO of stocks and crypto website ADVFN, believes the similarities with the last major crash are “incredible”.

He tells The Independent: “In 2017 the BTC and ETH relationship was quite exciting with Ethereum booming after the BTC top. It’s happened again… In the end it will likely be a 75 to 85 per cent crash from peak and lots of tokens will go down 90 to 99 per cent.

“The next crypto winter will be as long as the last and the coming boom will be twice as high as this one.”