Cryptocurrency roundup: Bitcoin falls below $60,000 and Tesla's Elon Musk U-turns again

Bitcoin falls below $60,000, Tesla's Elon Musk signals the company may accept crypto again and El Salvador buys more bitcoin. Saloni Sardana rounds up on the biggest crypto stories of the week.

Bitcoin and gold
Bitcoin: 21st-century gold?
(Image credit: © Ulrich Baumgarten via Getty Images)

Welcome back,

It was an eventful week in the world of crypto, with bitcoin slipping to $58,000, its lowest level in two weeks. Although the popular cryptocurrency recovered and traded above the $60,000 mark for most of the week, questions remain about how sustainable bitcoin’s comeback is.

Here are the top stories that caught our eye.

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Bitcoin fell below $60,000 this week

After a spate of factors including approval of a bitcoin ETF helped bitcoin cross $60,000 in recent days, the popular cryptocurrency fell again this week to below the $60,000 mark.

The cryptocurrency traded as low as $58,113 this week, just a week after the cryptocurrency had hit a fresh all-time high of almost $67,000 last week.

This means the cryptocurrency’s honeymoon period could potentially be coming to an end.

Bitcoin was very much the darling of markets at the start of the year before a number of countries such as China announced tougher scrutiny of the sector and even banned cryptocurrency mining in China. Policy U-turns by popular figures such as Tesla’s Elon Musk also kept the cryptocurrency volatile.

But still, bitcoin is up more than 116% since the start of the year.

Tesla may accept bitcoin again

That being said, in another apparent U-turn, Elon Musk doesn’t appear to have completely abandoned crypto payments yet. The company said in its third quarter earnings release this week that it may accept payments using cryptocurrencies for its services and products at some point in the future.

“We may in the future restart the practice of transacting in cryptocurrencies ("digital assets") for our products and services,” Tesla said in the filing.

The comments come as Tesla’s market cap exceeded the $1trn mark this week.

The company also announced that it purchased an aggregate $1.5bn worth of bitcoin in the nine months ending 30 September.

“In addition, during the three months ended March 31, 2021, we accepted bitcoin as a payment for sales of certain of our products in specified regions, subject to applicable laws, and suspended this practice in May 2021,” the filing said.

Musk’s comments, and U-turns are both important for the world of cryptocurrencies, as a number of endorsements, and announcements such as Tesla purchasing $1.5bn worth of bitcoin earlier this year, was a key factor propelling bitcoin and some other cryptocurrencies to record highs.

Crypto markets were badly affected earlier this year when Musk signalled Tesla would not accept bitcoin as payment due to concerns bitcoin mining is bad for the environment

El Salvador purchased $25 million worth of bitcoin

El Salvador added a further 420 bitcoins to its official bitcoin portfolio- worth $25m- the country’s president Nayib Bukele revealed in a Tweet this week.

The latest purchase paves the way for the country’s bitcoin holdings to total 1,120 coins.

The purchase can be seen as an attempt to capitalise on bitcoin's fall to $58,000 this week.

The purchase also follows El Salvador’s purchase of 150 coins in September when the country became the world’s first to officially adopt bitcoin as legal tender.

Back in September, El Salvador’s government started building bitcoin ATMs and created a $150m fund to help facilitate exchange between bitcoin and the US dollar.

The decision to make bitcoin legal tender came from the fact that El Salvador is highly dependent on remittances and the government hoped that making bitcoin the official currency in the country would make it cheaper to send money overseas.

However, the country’s adoption of bitcoin has been marred with chaos and even mass protests.

Here’s what happened in the cryptocurrency market in the last seven days:

  • Bitcoin is flat at $61,899.
  • Ether is up 9% to $4,382.
  • Dogecoin is up 19% to $0.29.
  • Cardano is down 6% to $2.
  • Solana is up 6% to £200.

Iran set to pilot its central bank digital currency

The Central Bank of Iran is to pilot its own “national cryptocurrency” soon, says The Islamic Republic is “studying potential risks and benefits” and will launch it “once the Money and Credit Council approves it”, said Ali Salehabadi, the governor of the central bank.

Saloni Sardana

Saloni is a web writer for MoneyWeek focusing on personal finance and global financial markets. Her work has appeared in FTAdviser (part of the Financial Times),  Business Insider and City A.M, among other publications. She holds a masters in international journalism from City, University of London.

Follow her on Twitter at @sardana_saloni