How is Elon Musk Impacting the Cryptocurrencies Scene?

Bitcoin rebounded on Monday, recovering from the lowest level for the cryptocurrency in about three months, after recent steep declines.

The largest cryptocurrency in the world in terms of market capitalization was hit hard by the decision of Tesla, owned by billionaire and major supporter of digital currencies Elon Musk, to no longer accept Bitcoin as a payment method for the company’s famous products and electric cars.

The decision came due to criticism that a company like Tesla that is producing environmentally-friendly products should not be investing as much as $1.5 billion in Bitcoin. Especially at a time when mining the cryptocurrency is consuming huge energy sources most of which continue to come from fossil fuel, making Bitcoin’s carbon footprint a huge burden on the efforts to combat climate change.

The move prompted worries that Tesla might be giving up its huge investments in the digital currency, which led to increased institutional inflows into crypto.

However, Musk announced through Twitter that Tesla has not sold any Bitcoin, which provided support to the currency, currently trading above $45,365, rising by about 3% and limiting its losses over the past seven days to about 18%.

Earlier today, Bitcoin fell as much as 9% below $42,200, reaching its lowest level since February 8.

In addition, his appearance on the New York Saturday Night Live (SNL) comedy show saw Musk once again supporting Dogecoin, a digital currency that started as a joke based on an internet meme but has recently attracted investments, prompted mostly by interest from Musk. However, Musk jokingly approved a description of Dogecoin as a hustle.

Surely this has led to acquisitions that the famous billionaire might be manipulating the market in favor of his investments and those of his company.

Recent media reports indicated that over a period of six months, scammers have collected more than $80 million from people who were seeking investments in cryptocurrencies.

Scammers specifically impersonating Musk on social media cheated retail investors out of more than $2 million, after promises to increase Bitcoins sent to their wallets, according to the U.S. Federal Trade Commission.

More than 7,000 people have reported being subject to fraud in the cryptocurrency domain, with a median loss of $1,900.