Tesla Inc recently reversed its decision to accept bitcoin as a form of payment after it had invested $1.5 billion in the cryptocurrency in February. Elon Musk wrote on Twitter on Wednesday that Tesla will not accept bitcoin as payment for its vehicles. This move comes after Musk’s concerns about the increasing use of fossil fuel for Bitcoin mining and transactions. As a result, Bitcoin dropped by 15% to $46,000 on Thursday.
The mining of Bitcoins involves a complex, energy-draining process that could have a larger environmental impact if the cryptocurrency rises. Mining the token consumes 66 times more electricity than it did in late 2015, according to a Citigroup Inc report. Musk shared on Twitter a chart showing Bitcoin’s energy consumption over the past few months calling it “insane”.
Elon Musk’s decision as the Chief Executive Officer at Tesla is “very odd” and “confusing” as expressed by Nic Carter, a founding partner at Castle Island Ventures and a leading voice among defenders of Bitcoin’s energy use. After more than three months of having invested in Bitcoin and raising the hopes of investors, Musk is now backing up. However, Tesla will not sell Bitcoin it had purchased.
This raises questions about the true purpose of his recent decision. It might be in the favor of another cryptocurrency Musk is supporting, DogeCoin.
References:
1) Elliott, R., & Vigna, P. (2021, May 12). Elon Musk Says Tesla has SUSPENDED accepting bitcoin for vehicle purchases. Retrieved May 13, 2021, from https://www.wsj.com/articles/elon-musk-says-tesla-suspends-accepting-bitcoin-for-vehicle-purchases-11620858838?page=1
2) Peterseil, Y., & Hajric, V. (2021, May 13). Bitcoin Tumbles Below $46,000 Amid Aftershocks From Musk’s Blast. Retrieved May 14, 2021, from https://www.bloomberg.com/news/articles/2021-05-13/bitcoin-falls-below-50-000-as-musk-calls-energy-use-insane
Kommentare