M. Burry says Tesla's $1.5 B Bitcoin was distraction - and Dogecoin's record price is massive bubble

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Burry described the landmark purchase as "#digitalconfetti" to distract from Tesla's run-in with Chinese regulators.

"The Big Short" investor Michael Burry.

"The Big Short" investor Michael Burry suggested Tesla bought Bitcoin to distract from regulatory issues in China.

Burry also pointed to Dogecoin's record price as evidence of a huge market bubble.

The Scion Asset Management boss revealed he was short Tesla in December.

Michael Burry questioned Tesla's Bitcoin investment and sounded the alarm on Dogecoin's record price in a series of now-deleted tweets on Monday.

"Chinese regulators summon Tesla on quality issues as consumers complain about quality ... but $TSLA bought $BTC," the Scion Asset Management boss tweeted, using the tickers for Tesla and Bitcoin. "In my mind's eye, so much #digitalconfetti."

In other words, Burry thinks Tesla may have timed its $1.5 billion purchase of Bitcoin to distract from its China troubles.

Burry, whose billion-dollar bet on a US housing-market collapse was chronicled in Michael Lewis' book "The Big Short," revealed he was short Tesla in December. He poked fun at Tesla CEO Elon Musk and the fact his company's stock price has moved in tandem with Bitcoin in another tweet on Monday.

"$TSLA and $BTC correlation coefficient is 0.951967 over the last six months," Burry said. "@elonmusk going for perfect unity? Nah, Elon dreams the impossible. He is determined to break unity. Correlation > 1. And he has history on his side. $TSLA and $BTC investors can make anything happen."

Tesla was not immediately available for comment when contacted by Insider.

Read more:Credit Suisse says to buy these 16 'highest-conviction' stock picks that are set to outperform despite the market's contrarian view

Burry, who unknowingly laid the groundwork for GameStop shares to skyrocket as much as 2,500% last month, took aim at Dogecoin in another tweet. The cryptocurrency, which was created as a joke, soared to a record high this week after Musk tweeted about it. It now commands a $10 billion market capitalization.

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