What caused the significant drop in Bitcoin this morning? Did SpaceX, owned by Musk, sell Bitcoin?

Yesterday, the WSJ reported that Elon Musk's space exploration technology company, SpaceX, sold Bitcoin, causing panic in the community. Bitcoin dropped from 27,677 to 25,409 in Taiwan this morning at 5 o'clock, a significant 8% decline. What did the WSJ really say? Did SpaceX actually sell coins?

WSJ Analysis of SpaceX Financial Situation

SpaceX, founded by Elon Musk in 2002, is a private American aerospace technology company with the goal of reducing the cost of space transportation and eventually colonizing Mars. It has become a major rocket launch provider in the United States and has established the Starlink low-orbit satellite constellation. NASA relies on SpaceX to transport astronauts to and from the International Space Station.

As a private company, SpaceX is not publicly traded and therefore not required to disclose its financial reports. However, WSJ claimed yesterday that it reviewed relevant documents indicating that SpaceX achieved a slight quarterly profit at the beginning of this year. Its total expenditure for 2022 is around $5.2 billion, higher than the $3.3 billion from the same period last year. Revenue doubled to $4.6 billion, helping the company reduce its losses from $968 million last year to $559 million.

Did SpaceX Sell Bitcoin? When?

The documents also show:

SpaceX wrote down a total of $373 million worth of Bitcoin it owned in 2020 and 2021 and sold some Bitcoin.

WSJ also mentioned that Tesla took a similar approach with its Bitcoin holdings.

According to previous reports, after purchasing 48,000 Bitcoins in 2021, Tesla sold 4,800 and 32,400 Bitcoins in the first quarter of 2021 and the second quarter of 2022, respectively. The official explanation was to hold more cash to deal with future market uncertainties. The current inventory of Bitcoin stands at 10,800.

Facing the Federal Reserve's aggressive interest rate hikes since early last year, Musk has publicly stated multiple times that high interest rates would harm the economy and affect the company's development. Selling Bitcoin by Tesla and SpaceX was to hold more cash, which happened in the first quarter of 2021 and the second quarter of 2022, rather than recently as some communities believe!

Cryptocurrency Market Liquidations Exceed $1 Billion

According to Coinglass data, the cryptocurrency derivatives market experienced approximately $1.03 billion in liquidations in the past 24 hours, with as much as 80%, about $835 million, coming from long positions, and Bitcoin liquidations amounting to $495 million.

Although global stock markets have been declining in recent days, the panic selling in the cryptocurrency market seems somewhat exaggerated, or perhaps the market is just looking for a reason. However, in today's fast-paced and information-overloaded world, developing the ability to correctly identify truth from falsehood is becoming increasingly important!

Recent market analysis: Cathie Wood's prediction, Evergrande Group filing for bankruptcy, Bitcoin briefly approaching $25,000