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Elon Musk has long been Bitcoin’s foremost advocate. Its avid support for cryptocurrency has been instrumental in shifting public perception in favor of Bitcoin and has bolstered the asset’s legitimacy in global markets. Bitcoin owes a lot to Musk for its recent boom and surge in prices as cryptocurrency enters the mainstream largely thanks to the decision of the CEO of Tesla to buy $ 1.5 billion worth of bitcoin by the intermediary of the electric car company and start to accept currency as a valid method of Payment.
This risky move was just the start of what would prove to be a multi-month roller coaster of dramatic events and market turmoil for Musk, Tesla and Bitcoin. First, the bold purchase and very public endorsement of a very volatile cryptocurrency scared off Tesla investors. In the wake of the Bitcoin purchase, Tesla’s previously skyrocketing stock price fell dramatically, turning the company negative for the year in February.
“This pullback really started after Tesla made the decision to buy $ 1.5 billion worth of bitcoin,” said Garrett Nelson of New York-based investment research firm CFRA, as quoted by MarketWatch at the ‘time. “Although Tesla used a relatively small percentage of its overall money to make the purchase, investors are questioning its future growth strategy.” While the bitcoin purchase paid off for Tesla in the short term – to the tune of around $ 1 billion in profit on paper – the move married Tesla’s share price to the value of Bitcoin, who both dived soon after.
Then, last month, Musk made a total of 180 on his long-standing loyalty to Bitcoin. Tesla CEO announced that the electric vehicle company will stop accepting Bitcoin as a payment method. The reason given by Musk had nothing to do with the cryptocurrency’s notorious volatility, or the cold feet of its investors, but rather focused on Bitcoin’s large and growing negative environmental externalities.
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The announcement came amid increasing scrutiny and criticism of the cryptocurrency’s massive energy consumption and increasing carbon footprint. Some of Bitcoin’s outspoken critics and the threat it poses to the fight against global warming is none other than that other really, really wealthy and influential techie, Bill Gates. “Bitcoin uses more electricity per transaction than any other method known to mankind,” Gates told the New York Times in April, weeks before Musk’s turnaround, as part of a high-profile dismantling of the cryptocurrency. active.
This is because Bitcoin uses more energy each year than many entire countries. With 112.57 terawatt hours per year, Bitcoin ranks between the Netherlands (110.68 terawatt hours per year) and the United Arab Emirates (119.45 terawatt hours per year). In total, Bitcoin miners represent 0.52% of global consumption.
As part of Musk’s new environmental priorities, he helped build a completely toothless Bitcoin Mining Council that set out to improve the sustainability of cryptocurrency following a meeting between d prominent North American Bitcoin and Musk miners. The council is advocating for greater transparency in energy use and campaigning to get miners to switch to renewable energy sources. Of course, the whole idea of giving transparency-centric recommendations and guidelines to a group of people whose only united values are decentralization, autonomy and anonymity will be a lot like breeding anarchist cats. All that to say: good luck with that.
Finally, this week alone, Musk gave more weight with a much bigger incentive to the imperative, announcing (on Twitter – where else?) That Tesla will resume accepting Bitcoin payments once the cryptocurrency is up and running. on an approximate minimum of 50%. clean energy. The Bitcoin stock received a significant boost immediately afterwards. Bitcoin and Musk are going over and over again, going or not going to profit from more highs and lows and public volatility for the foreseeable future, so stay tuned. Or instead direct your attention to Dogecoin, a more eco-friendly and even more absurd musky protege, available now in an absurd Twitter thread near you.
By Haley Zaremba for OilUSD
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