The cryptocurrency bull market appeared to come to a crashing end in the month of May. Elon Musk, the co-founder and CEO of Tesla (NASDAQ:TSLA), played an outsized role in bitcoin’s rise and fall in the late winter and spring of 2021.
In early February, Musk announced that Tesla had invested $1.5 billion in the top digital currency. This powered a run to all-time highs that Tesla was able to feast on in the first quarter. Musk had gone on to drop mentions for other cryptos like Dogecoin on social media. However, this love affair turned sour after his "Saturday Night Live" appearance in early May.
On SNL, Musk called Dogecoin a “hustle” in a scripted appearance on the satirical news segment. Later this month, Musk announced that Tesla would no longer accept bitcoin as payment for its products due to its carbon footprint. On social media, some users feared that he hinted that Tesla had possibly dumped its bitcoin holdings.
Musk would go on to deny this, but the damage appeared to be done. The spot price of bitcoin was trading just above the $36,000 U.S. at the time of this writing. This is down from an all-time high of $64,829 U.S.
Canada launched the very first bitcoin-focused exchange-traded fund in February 2021. The Purpose Bitcoin ETF (TSX:BTCC.B) has plunged 34% since its inception. This ETF last had an RSI of 31, putting it just outside of technically oversold territory. Bitcoin has proven itself as a legitimate asset class in 2020 and 2021. Investors hungry for exposure to crypto should consider buying the dip and holding for the long term.
