After briefly disappearing from prominent news sections, Bitcoin appears to be reclaiming headlines—though still overshadowed by inflation-related coverage. For Bitcoin investors, its climbing price is far more exciting than inflation data.
After hovering around $30,000 (a relatively low point) for nearly two months—occasionally dipping below this threshold—Bitcoin surged past $40,000 per coin on July 26, peaking at $40,501.70. This upward trend wasn't instantaneous. Bitcoin had already marked eight consecutive days of gains by July 24, reaching $34,609 and surpassing its 50-day moving average for the first time since May 12.
Even if Bitcoin climbs to $35,000 (its monthly futures market cap) or even $40,000, reclaiming its April peak of ~$65,000 seems increasingly unlikely. Meanwhile, Elon Musk recently reiterated his "supportive" stance.
SpaceX Still Holds Bitcoin, but Musk's Influence Wanes
Last week's Bitcoin rally didn’t capture widespread attention beyond crypto holders, who saw it as a bullish signal toward the $30,000–$40,000 range.
Earlier, Bitcoin dipped below $30,000 after the U.S. Treasury, Federal Reserve, and regulators issued warnings about stablecoins. However, Musk’s remarks—alongside those of Jack Dorsey and Cathie Wood—combined with Amazon’s ambiguous signals, injected momentum into Bitcoin. The cryptocurrency climbed steadily from July 21, nearing $39,000 by July 26 before hitting $40,501.70.
During the July 21 "B Word" conference hosted by the Crypto Council for Innovation, Musk stated that SpaceX holds Bitcoin and Tesla might resume accepting Bitcoin payments for its EVs. He also disclosed personal holdings of Bitcoin, Ethereum, and Dogecoin.
Cathie Wood urged corporations to add Bitcoin to their balance sheets as an inflation hedge, while Dorsey praised Bitcoin’s resilience and announced Square’s plans for Bitcoin-based decentralized finance projects.
Despite these endorsements, Bitcoin’s recent surge past $40,000 may not be solely Musk-driven. His erratic statements have increasingly marginalized his influence.
On July 26, Bitcoin jumped 14.5% to a six-week high of $40,501.70, fueled by short-covering and speculation about Amazon potentially accepting crypto payments. Though Amazon later denied concrete plans, the delayed clarification sparked theories about market manipulation.
Short positions totaling ~$740 million were liquidated that day—the highest in three months.
Market Sentiment: Musk’s Credibility in Crypto Circles Has Collapsed
"Crypto analysts and investors increasingly dismiss Musk’s volatility," one trader noted. "This rally was primarily driven by Amazon rumors, not Musk."
Some believe sidelining influencers like Musk benefits Bitcoin’s long-term stability. "KOL-induced volatility only heightens market risk without substance," said one investor. "Stronger regulations and price normalization are healthy for crypto’s future."
Corporate Bitcoin Holdings Face Accounting Challenges
While Dorsey advocates for corporate Bitcoin adoption, early adopters like Tesla and MicroStrategy face accounting complexities. Tesla reported a $2.3 million Bitcoin impairment in Q2 2021, trivial against its $1.142 billion net profit. MicroStrategy, with $2.25 billion in Bitcoin holdings, anticipates larger write-downs.
Can Bitcoin Reclaim Its Peak? Only With a Black Swan
Despite bullish momentum, traders doubt Bitcoin will revisit its $65,000 April peak without a black-swan event. "Institutional adoption (e.g., Grayscale) could be such a catalyst," one analyst said. "But the $65K rally was inflated by hype and retail speculation."
Current Bitcoin valuation remains speculative, unlike stocks with transparent institutional activity. "Bitcoin’s anonymity and off-market transfers complicate pricing," the analyst added.
The Shift From Storage to Trading Value
Bitcoin and Ethereum may have transitioned from storage assets to trading instruments—akin to pre-2008 mortgage derivatives, solving one problem while creating another.
Man Group’s CEO Luke Ellis called cryptocurrencies "devoid of intrinsic value" but acknowledged their trading appeal due to volatility.
As of now, Bitcoin stabilizes near $37,000—~40% below its April high.
FAQ
Q: Why did Bitcoin recently surge past $40,000?
A: The rally was driven by short-covering, Amazon payment rumors, and broader market optimism, not solely Elon Musk’s comments.
Q: Is Musk still influential in crypto markets?
A: His credibility has waned due to inconsistent statements. Many investors now prioritize fundamentals over influencer hype.
Q: Can Bitcoin reclaim its $65,000 peak?
A: Unlikely without a major catalyst (e.g., institutional adoption or regulatory shifts). Current gains are modest compared to April’s speculative frenzy.
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