Elon Musk has been known to be controversial when he Tweets to the public, and this time seems to be no exception. It was just recently that he announced Tesla was accepting payment in the form of Bitcoin, and now he’s back-stepping and trying to shuffle out of that statement by declaring the polar opposite news update. As of this week, Elon Musk has just announced that Tesla is no longer accepting Bitcoin, citing increased use of fossil fuels as being among the reasons of concerns. Bloomberg reports that as quickly as he Tweeted this update, Bitcoin saw an astounding 15% drop in price.
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Elon Musk is under fire once again, this time for his back and forth commentary on the acceptance and now non-acceptance of Bitcoin in the world of Tesla. This once embraced cryptocurrency was highly promoted by Musk, but is now suddenly being shunned, making this one of the biggest announcements and then subsequent retractions that Musk has been responsible for.
His love- hate relationship with Bitcoin is causing a lot of confusion in the industry, with professionals and fans alike, struggling to identify precisely which part of the conversation Musk actually supports.
As he wavers back and forth with apparent uncertainty, the price of Bitcoin has already dropped by 15%. The belief is that this is resulting from this sudden shift away from using this cryptocurrency in the world of Tesla. By suspending the use of Bitcoin, Musk is limiting its overall functionality and causing doubt about the cryptocurrency’s future in the market.
The reason for this shift is presumably one that Musk would have been aware of prior to his announcement that Tesla would be embracing Bitcoin payments… fossil fuels and energy use.
The Daily Mail states that; “Creating Bitcoins and other cryptocurrencies requires a lot of electricity, releasing massive amounts of greenhouse gases. The cryptocurrency is ‘mined’ by high-powered computers that continuously solve computational math puzzles, the complexity of which means the processors require huge amounts of energy. With each solved problem, a certain amount of coin is produced. While the machines use electricity, fossil fuel is a major category in electricity generation.”
A Tweet sent out by Musk was the catalyst for the price drop in Bitcoin. The markedly significant 15% drop was visible nearly immediately after Musk Tweeted; “We are concerned about rapidly increasing use of fossil fuels for Bitcoin mining and transactions, especially coal, which has the worst emissions of any fuel.”
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Sources: Daily Mail, Bloomberg
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