The relationship between Elon Musk and cryptocurrency is a long and well-known one, and the “Technoking of Tesla” has been a strong advocate for various types of cryptocurrency for quite a while. Not long ago, Tesla had bought $1.5 billion worth of bitcoin and hinted that it may invest in more bitcoin or other cryptocurrencies in the future. During this announcement, it also laid out plans to start accepting Bitcoin as payment for its cars. However, that seems to have come to a sudden halt, after Musk took to Twitter to announce that his electric vehicle company Tesla has suspended the use of popular cryptocurrency Bitcoin to purchase its electric cars, citing concerns over “rapidly increasing use of fossil fuels for bitcoin mining.”
This is a complete reversal to Musk’s earlier stance on the world’s biggest digital currency, where he had said that Tesla would be accepting Bitcoin as payment for its cars from March. Not only had Musk’s statements and actions raised the price of bitcoin, but the eccentric billionaire had also hoped that Bitcoin, and cryptocurrency in general, would become the currency of the future.
“Tesla has suspended vehicle purchases using Bitcoin. We are concerned about the rapidly increasing use of fossil fuels for Bitcoin mining and transactions, especially coal, which has the worst emissions of any fuel.
Tesla & Bitcoin pic.twitter.com/YSswJmVZhP
— Elon Musk (@elonmusk) May 12, 2021
While Musk bats for cryptocurrency, he is a strong advocate for clean energy as well.
Bitcoin’s price fell rapidly after the tweet, as one would expect.
Musk added that Tesla would not be selling any Bitcoin, and intends to continue to use it for transactions as soon as mining transitions to more sustainable energy. Bitcoin is mined when high-powered computers compete against other machines to solve complex mathematical puzzles, an energy-intensive process that currently often relies on electricity generated with fossil fuels, particularly coal. The mining of Bitcoin consumes nearly the same amount of energy annually as the Netherlands did in 2019, according to the latest available data from the University of Cambridge and the International Energy Agency.
With the increase in the value of Bitcoin, mining of cryptocurrency has become much more profitable. Thus, more and more operations are being carried out. Bitcoin-mining operations around the world collectively use around a hundred and twenty terawatt-hours of energy every year. It has been a matter of concern for environmentalists.
This comes after Elon Musk had put up a poll, asking if Tesla should start accepting Dogecoin as payment. Moreover, its sister company SpaceX has also announced the first lunar satellite launch to be funded entirely by the meme-inspired Dogecoin.
