According to analysts, bitcoin hit a high of $24,276 on Monday, July 25. The asset strengthened after its recent collapse to $19,740. However, it was a short-term rally. Currently, BTC is trading around $22,875, having risen slightly after a pullback to $22,640.
Experts believe the reasons for profit taking on BTC are a decline in risk appetite and Tesla’s decision to sell tokens. Earlier, the electric car maker announced that it had sold 75% of its BTC holdings for $936 million. Analysts estimated that Tesla has incurred a loss of $1 billion against this backdrop.
"The reason we sold a bunch of our bitcoin holdings was that we were uncertain as to when the Covid lockdowns in China would alleviate so it was important for us to maximize our cash position", Tesla CEO Elon Musk said.
"This should be not taken as some verdict on bitcoin”, Musk noted, adding that Tesla is open to increasing its crypto holdings in the future.
Moreover, the ECB’s hawkish stance will have a significant impact on the cryptocurrency market in the near future. The European regulator plans to raise the interest rate. The $22,500-$22,600 range will be the support level for BTC in the short term. At the same time, experts note that $23,000 will remain the psychological level for the cryptocurrency.
