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Elon Musk on Wednesday canceled support for bitcoin, announcing that it had suspended plans to accept payment for cars at the cryptocurrency conference.
He expressed environmental concerns about the mechanism used to validate Bitcoin transactions, emphasizing the broader rethinking of digital currency that could make it increasingly attractive among other companies.
Musk has been confronted sharp reprimands More than the support that Tesla has given to bitcoin, among its ESG investors who prioritize environmental, social and governance issues. Tesla CEO is excited about energy-hungry currency ran counter Concerns about climate change have always led to concerns about the involvement of electric cars.
Bitcoin prices rose 15 percent in a single day in February when Tesla revealed he put $ 1.5 billion into his corporation’s money enter digital currency and one day accept what is planned in car payments. The news was widely seen as an important validation of bitcoin in the corporate business he sparked discussion among corporate treasurers on the use of currency.
In one short statement Musk released it on Twitter on Wednesday: “We are concerned [the] the use of fossil fuels is rapidly increasing for bitcoin mining and transactions, especially coal, which has the worst emissions of all fuels. “
Bitcoin uses a “proof of work” mechanism, based on so-called miners who use large-scale sets of computers, using a consensus algorithm to break up puzzles.
Musk’s statement concluded that Tesla was “analyzing other cryptocurrencies that use 1% of bitcoin’s energy / transaction,” a comment that could give a shot in the arm to digital currencies that use other less powerful ways to validate transactions.
Ether, the second most valuable cryptocurrency, has said it is moving to an alternative method known as “game proof,” and that doesn’t depend on it. an energy-hungry method.
Musk also revealed that Tesla had vowed to trade in bitcoin to increase future profits. The company’s investors were surprised to learn that it had sold its cryptocurrency shares in a few weeks last month. $ 101 million profit. Along with the sale of environmental loans, foreign exchange trading has gained more than the loss in Tesla’s main automotive business in the first quarter of the year.
“We will not sell bitcoin,” the head of Tesla said in his statement, although he did not shed any further light on how long the automaker would intend to keep the cryptocurrency or its money to deposit more money into bitcoin.
The document stated that it had withdrawn from the use of bitcoin in Tesla’s treasury operations. Company officials recently described the sale of the currency as evidence of liquidity, turning it into a suitable asset for treasury storage – which would be ruined if Tesla did not intend to use it as a source of liquidity.
The price of Bitcoin fell about 4 percent after Musk’s statement.
Bitcoin reversal can also throw up the cloud dogecoin, the cryptocurrency that has had the biggest gains this year, thanks in large part to Musk’s support. As with bitcoin, dogecoin uses proof of the working mechanism.
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