Bitcoin drops 17% after Elon Musk’s comment on valuation

Bitcoin, world’s biggest cryptocurrency, plummeted as much as 17 per cent on Tuesday, with prices tumbling below $50,000 as investors grew nervous at sky-high valuations.

Bitcoin has been on a tear in recent times, buoyed by acceptance among mainstream investors and companies, such as Tesla Inc, Mastercard Inc and BNY Mellon.

However, top investor, Elon Musk’s comments over the weekend saying the prices of Bitcoin and Ether “seem high” were viewed as the initial catalyst for the selloff.  He lost more than $15 billion in just one day after a plunge in the value of Bitcoin dented his net worth.

Also, Ether, the world’s second largest cryptocurrency by market capitalisation, that often moves in tandem with bitcoin, also dropped more than 20 per cent to $1,410, down over 30 per cent from last week’s record peak.