Are things about to go under for Elon Musk, the famed founder of SpaceX and Tesla? Analyst Julian Bridgen has been comparing Tesla’s stock price to the bitcoin bubble of 2017, which ultimately popped in very ungraceful fashion. He’s claiming that Tesla can expect to see similar results very soon.
Tesla Isn’t Looking Very Stable as of Late
Elon Musk is a very intriguing figure in many ways. Despite having little to do with bitcoin, he’s come to be known as one of the biggest promoters of the cryptocurrency. He always seems to talk about it yet doesn’t really contribute much to the space in terms of time, energy or resources. He talks about Dogecoin, for example, quite a bit, and seems to be a major fan. However, when the opportunity to serve as CEO to Dogecoin came about, Elon Musk appeared uninterested to say the least.
It’s hard to put one’s finger on the relationship between Musk and crypto. For the most part, there appears to be something there, though it’s not quite clear what it is or even how big it might be.
Either way, considering what an influential figure Musk has been in the crypto space, it’s ironic that the stock shares of his own company would potentially take on the same form as the world’s biggest and most popular form of crypto by market cap.
As we all remember, 2017 was “marred” by a certain bitcoin bubble. The currency rose from $1,000 to about $20,000 per unit by the time the year was over. The currency incurred gains of roughly $19K within 12 short months, and yet by February of next year, most of the asset’s gains had been lost. The currency fell into the $9,000 range and ended 2018 on an even lower note of around $3,500.
This will probably go down as the worst moment in bitcoin’s short, yet significant history, and now, according to the co-founder of MI2 Partners – a macroeconomic research firm – Tesla is taking on a similar form. The company is currently finding itself within a bubble and could soon come crashing down the same way bitcoin did.
At first glance, it’s hard to ignore some of the evidence at hand. Tesla is one of the few companies that expanded during the coronavirus pandemic, a time when most other companies were in the gutter. The company saw its shares explode during the earlier months of the year when most other enterprises had entered a period of deep suffering. By the end of August, one share of Tesla stock was trading for just under $500.
Has a Bubble Formed?
In a tweet, Bridgen commented:
What defines a bubble? A great story is essential. In fact, the better the story, the bigger the bubble. Then lots of liquidity and finally a classic bubble chart. For example, #bitcoin in 2017. In #TSLA, we have all three.