Bitcoin plunge as Musk SpaceX sale is reported

Bitcoin plunge as Musk SpaceX sale is reported
Cryptocurrency falls up to 8% in trading.
AUG 18, 2023
By  Bloomberg

Cryptocurrencies extended declines, sliding with global risk assets as investors price in higher interest rates for longer. A report of Elon Musk’s SpaceX selling Bitcoin holdings added to the concerns. 

Bitcoin fell 4.4% at 9 a.m. in London on Friday, and was headed for its biggest weekly decline in three months, after touching a low of $25,314. The largest cryptocurrency started retreating from $28,947 a day earlier as global bond yields hit multi-year highs, reducing the appeal for alternative investments such as digital tokens.

The sudden fall after weeks of thin trading sparked massive liquidations across exchanges. More than $1 billion of positions were unwound in the past 24 hours as prices fell, according to Coinglass data. A Wall Street Journal report citing documents that SpaceX has sold off its Bitcoin holdings after writing down $373 million also weighed on sentiment.

“With limited catalysts to push Bitcoin higher in the short term, a fall below $25,000 could put bears in charge, and if the rout in global risk assets continues, Bitcoin could face further downside,” said Josh Gilbert, market analyst at trading and investing firm eToro.

It wasn’t clear from the WSJ report when SpaceX had sold its Bitcoin.

While broader markets are seeing a pullback in the selling as the dollar weakened, the selloff in digital tokens amid thin liquidity continued unabated on Friday. The top 100 digital tokens gauge fell more than 5% at one point, outstripping a 0.2% decline in a regional stock index. Ether slipped 1.5% while Cardano and Solana fell 2.2% and 2.5%, respectively. 

The largest single liquidation order happened on Binance, and was worth $55.92 million, Coinglass said in its website. The total amount of Bitcoin liquidations was the biggest for a single day since the market turmoil of June 2022, CoinDesk reported. 

The next support level for Bitcoin is $25,000 and a breach may accelerate liquidations, according to analysts. That level has the highest level of open interest among put options for Aug. 25 expiry, according to data from Deribit. Should Bitcoin drop below that level, sellers of those puts would be forced to liquidate or hedge their positions, putting further pressure on prices.   

ETF Support

The slide has almost erased the gains registered in the wake of BlackRock’s Inc.’s surprise filing for a Bitcoin ETF on June 15. After surging 72% in the first quarter, Bitcoin has declined almost 7% since the end of March. The token tumbled 64% last year amid a series of industry scandals and bankruptcies. 

Some degree of optimism crept into the market after Bloomberg News reported that the US Securities and Exchange Commission is poised to allow the first exchange-traded funds based on Ether futures.

The drop in Bitcoin follows a period in which the cryptocurrency traded in a narrow range for months. Gauges that measure the price swings of the original cryptocurrency have been trending down, with the 90-day volatility reaching its lowest since 2016 this week, according to data compiled by Bloomberg.

“There was optimism earlier in the week that a resolution to the Grayscale Bitcoin ETF would come this week but that passed with nothing coming out,” Shiliang Tang, chief investment officer at crypto investment firm LedgerPrime, said. “Furthermore traditional markets have been weak all week with SPX and tech selling off, 10-year rates reaching highs and the dollar catching a bid, and China credit and econ data weakness, all of which are negatives for risk assets.”

Latest News

RIA moves: NorthRock adds $800M Parkside Advisors, NFP acquires Levine Group in Tennessee
RIA moves: NorthRock adds $800M Parkside Advisors, NFP acquires Levine Group in Tennessee

NorthRock Partners' second deal of 2025 expands its Bay Area presence with a planning practice for tech professionals, entrepreneurs, and business owners.

Hightower taps Osaic alum Scott Hadley as first chief advisory officer, expands C-suite
Hightower taps Osaic alum Scott Hadley as first chief advisory officer, expands C-suite

Hadley, whose time at Goldman included working with newly appointed CEO Larry Restieri, will lead the firm's efforts at advisor engagement, growth initiatives, and practice management support.

Clients are nervous about volatility, but advisors know they need to stay the course
Clients are nervous about volatility, but advisors know they need to stay the course

Survey reveals how cutting through the noise is advisors' superpower.

Why the 'forgotten generation' is a powerful force in wealth management, consumerism
Why the 'forgotten generation' is a powerful force in wealth management, consumerism

Gen X is a powerful cohort that controls huge wealth but also faces retirement challenges.

RIA moves: True North adds $353M California RIA as SageView grows North Carolina presence
RIA moves: True North adds $353M California RIA as SageView grows North Carolina presence

Plus, a $400 million Commonwealth team departs to launch an independent family-run RIA in the East Bay area.

SPONSORED How advisors can build for high-net-worth complexity

Orion's Tom Wilson on delivering coordinated, high-touch service in a world where returns alone no longer set you apart.

SPONSORED RILAs bring stability, growth during volatile markets

Barely a decade old, registered index-linked annuities have quickly surged in popularity, thanks to their unique blend of protection and growth potential—an appealing option for investors looking to chart a steadier course through today's choppy market waters, says Myles Lambert, Brighthouse Financial.