Crypto Panic: Elon Musk’s $56 Billion Loss Sparks Concerns of a Potential Huge Sell-Off in the Cryptocurrency Market
Elon Musk’s dreams of a massive payday have been shattered by a Delaware Court of Chancery judge, who deemed Tesla’s $56 billion pay package for the CEO to be unfair to shareholders. The ruling has sparked concerns in the crypto world, with speculations that Musk may sell off his substantial Bitcoin holdings, currently amounting to 9,720 BTC.
The decision to cancel the record-breaking compensation came from Chancellor Kathaleen St. J. McCormick on January 30, 2024. This legal battle had dragged on for over five years, initiated by Tesla shareholders who accused Musk and the company’s directors of breaching their duties and diverting company resources for Musk’s personal gain.
The shareholders’ lawyers argued that the exorbitant payment to Musk should be voided, claiming that the negotiations were deceptive and lacking sufficient information for shareholders to make informed decisions. This isn’t the first time Chancellor McCormick has dealt with a case involving Musk; in a previous matter involving Twitter Inc., now known as X, Musk was forced to proceed with an acquisition, despite Twitter’s lackluster performance.
In response to the court ruling, Musk took to his social media platform, X, to offer some business advice, suggesting that companies should avoid incorporating in Delaware and instead opt for Nevada or Texas for more shareholder-centric decision-making.
The court ruling has raised concerns among investors about the potential impact on the cryptocurrency market, as there are speculations that Tesla, under Musk’s guidance, may consider selling its significant Bitcoin holdings. Tesla’s recent Q4 2023 financial report revealed impressive revenue of $25.2 billion and an operating profit of $2.1 billion. Throughout the quarter, Tesla maintained its Bitcoin position, holding onto 9,720 BTC for six consecutive quarters.
Currently, Bitcoin is facing resistance at $46,000, hovering around $43,014 with a slight 0.8% decrease in the last 24 hours. Notably, it has experienced an 8.32% increase over the week, intensifying the focus on Musk’s future actions and the potential impact on the crypto landscape.