Citing environmental concerns, Elon Musk set off a firestorm on Twitter and hours of volatile prices by releasing a statement saying Tesla will no longer accept BTC as a method of payment for it vehicles.
Musk further stated that the reason for this change is due to concerns about the “increasing use of fossil fuels for Bitcoin mining and transactions.”
Despite the market freefalls, Musk did reaffirm his support of cryptocurrencies in general. He also stated that Tesla will not sell its BTC but intend to use it once “mining transitions to more sustainable energy.”
After the tweet, BTC plunged roughly 12% and – as liquidations in the crypto occurred en masse – the rest of the markets also experienced drawdowns.
From an observer’s perspective, it’s fascinating to read Musk release a statement wherein he simultaneously:
- Suspends BTC use,
- Cites environmental concerns despite virtually nothing changing,
- Reaffirms support for cryptocurrencies generally,
- Says Tesla isn’t selling but provides support for altcoins, and
- Maintains future plans for BTC use
It’s extremely hard to imagine that at least one — if not both — of the following factors are at play:
- Pressure from politicians (Musk’s company is very reliant on gov’t funded renewable energy programs)
- Musk wants Tesla to get involved with more energy efficient crypto mining efforts
Either way, between joking that Dogecoin is a scam on SNL and now disparaging BTC maxi’s beloved Proof of Work, Musk has certainly lost a lot of public friends…even if he’s gained some political friends.
It’s hard to argue that any fiat currency is a better alternative to crypto. Fiat currency fluctuations are ultimately responsible for an enormous amount of inefficient capital planning on massive societal and economic levels.
That said, the debate among crypto enthusiasts regarding how bad BTC is compared to Proof of Stake alternatives is healthy. And it will be in full force tomorrow.
The hot takes tomorrow will be epic. They will be coming.