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Bitcoin Drops Below $50K After Elon Musk, Janet Yellen's Bearish Comments

Bitcoin (BTC) fell below the psychologically important $50,000 mark early Tuesday amid bearish comments from Treasury Secretary Janet Yellen and Tesla Inc (NASDAQ: TSLA) CEO Elon Musk.

What Happened: The apex cryptocurrency fell as low as $48,967.57 in the 24 hours trailing period to press time. The cryptocurrency slump comes after Yellen warned Monday that BTC was an inefficient way to conduct transactions. 

Speaking at the New York Times DealBook conference, Yellen said, “It’s an extremely inefficient way of conducting transactions, and the amount of energy that’s consumed in processing those transactions is staggering.”

The official said that she did not think BTC was widely used as a “transaction mechanism.” 

“To the extent it is used I fear it’s often for illicit finance,” said Yellen. 

Tesla CEO also weighed in on the high price levels at which BTC and ETH were trading on Monday in a Twitter exchange with gold bug Peter Schiff. 

Why It Matters: As of Monday, despite, the fall in cryptocurrency prices, Tesla’s $1.5 billion investment in BTC has returned nearly 70%. 

Another company that bet big on BTC, MicroStrategy Incorporated (NASDAQ: MSTR) has turned its $1.15 billion investment into $3.9 billion

Jack Dorsey-led Square Inc (NYSE: SQ) which purchased BTC worth $50 million has added $208 million in value to its investment, as of Monday. 

BTC has appreciated 73.08% on a year-to-date basis, while ETH has run up 124.09% in the same period.
Price Action: BTC traded 8.94% lower at $50,974.62 at press time.The second-largest cryptocurrency by market cap, Ethereum (ETH) traded 13.28% lower at $1,627.99.

Related Link: Bitcoin Might Be Tanking But These Ethereum Killers Are Posting Major Gains Today

© 2021 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.

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