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Tesla, Coinbase lead drop in crypto-related stocks as bitcoin plunges

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MSTRTSLACOINSpaceX founder and Tesla CEO Elon Musk looks on as he visits the construction site of Tesla’s gigafactory in Gruenheide, near Berlin, Germany, May 17, 2021.Michele Tantussi | Reuters

Cryptocurrency related stocks led by Tesla and Coinbase dropped on Wednesday as bitcoin plunged the equivalent of a bear market in just a single day.

Bitcoin, the world’s largest digital token, fell to nearly $30,000 at one point Wednesday morning, according to Coin Metrics. The price was down roughly 24%. (Any drop greater than 20% in an asset or security is considered a bear market.)

The move comes after China on Tuesday barred financial institutions from conducting crypto-related transactions. Separately, a JPMorgan report showed large institutional investors were dumping bitcoin in favor of gold.

The pullback this month in bitcoin intensified a week ago after Tesla CEO Elon Musk appeared to change his tune a bit on crypto by saying the company would stop accepting bitcoin for payment because of environmental concerns surrounding crypto-mining.

“You had a confluence of events…where you started breaking down the positivity in the price action, and now we’ve got a liquidation event,” Galaxy Digital CEO and Chairman Mike Novogratz told CNBC’s “Squawk Box.” “It’s not going to bounce right