Shortly after the entire cryptocurrency market shed more than $500 billion, Tesla and SpaceX CEO Elon Musk took to Twitter to assuage his followers.
Musk tweeted (in emoji form) that Tesla has “diamond hands,” tapping into a popular meme that means holding onto an investment even as the price drops.
Tesla has 💎 🙌
— Elon Musk (@elonmusk) May 19, 2021
The tweet suggests Tesla will not sell its Bitcoin holdings any time soon, and it had the expected effect: Bitcoin, which had begun rebounding just before his tweet, accelerated its bounce, up nearly 9% since the tweet was posted.
Tesla bought $1.5 billion worth of Bitcoin on February 8 to diversify its cash balances, and the purchase sent the whole crypto market higher. At that time, Tesla also said it would begin accepting Bitcoin as payment for its vehicles. Last week, exactly three months later, Musk shocked Bitcoiners when he reversed course and said Tesla will no longer accept Bitcoin due to environmental concerns. That immediately sent Bitcoin lower in a slide that has not yet stopped.
Another Musk tweet on Sunday in response to someone predicting Tesla will dump its Bitcoin ("Indeed") spooked crypto markets even further. But now it sounds like Musk is saying Tesla will hold on.
Tesla's Q1 earnings report did reveal that Tesla sold $272 million of BTC in late March, but Musk and Tesla’s CFO claimed the move was a test of Bitcoin's liquidity.