Elon Musk and The Cryotocurrency wave

By 구윤

Elon Musk, CEO of Tesla, founder of the Boring Company and billionaire, has instigated the whole cryptocurrency market. In March 2021, Musk had invested 1.5 billion dollars in bitcoin and announced that “Now you can buy a Tesla with bitcoin,” leading its price to skyrocket quickly. When the price reached its highest, Musk sold his bitcoin, worth roughly 300 million dollars, and gained about 110 million dollars through the process.   

 Then, Elon Musk posted a message on May 12th, abruptly declaring Tesla has suspended the acceptance of bitcoin as payment. According to him, Tesla is “concerned about rapidly increasing use of fossil fuels for Bitcoin mining and transactions, especially coal, which has the worst emissions of any fuel.” Musk said Tesla still plans to use bitcoin after the currency finds cleaner energy sources. "Tesla will not be selling any Bitcoin and we intend to use it for transactions as soon as mining transitions to more sustainable energy," he said. "We are also looking at other cryptocurrencies that use 1% of Bitcoin's energy transaction." This made the price of bitcoin plunge by more than 10 percent. 

 The return policy for cars bought with bitcoin worked in Tesla’s favor, stipulating that buyers get back bitcoin if it’s worth less than the equivalent dollar value at purchase but get back dollars if bitcoin is worth more.

Elon Musk has also been influencing dogecoin greatly. While bitcoin has been seen as a potential payments option since its inception, dogecoin was largely conceived as a joke. But the crypto has seen a stunning increase since Musk adopted it as a meme and began tweeting about it. It had strong gains last week before the billionaire’s guest-hosting appearance on Saturday Night Live, where he called it a ‘hustle.’ Then, after the abrupt rejection of bitcoin, Elon Musk asked on twitter what people thought about Tesla accepting dogecoin. Dogecoin’s price has risen, dropped, and risen again; what will happen next is hard to predict.

  There are strong controversies about Tesla’s such activities. 

  It is, for one, entirely true that mining bitcoins is energy-intensive. Researches say the annual carbon emissions from the electricity required to mine Bitcoin and process its transactions are equal to the amount emitted by all of New Zealand or Argentina.

  Many people say that Elon Musk and Tesla, whose mission is to “accelerate the world's transition to sustainable energy,” should have surely known bitcoin’s environmental issues long before. These people suspect Musk of deliberately manipulating other investors to suit his benefits, and demand that Tesla’s be scrutinized extensively. Others say this is merely a conspiracy theory, and that Tesla would have merely given in at all the reprimanding about energy it received after allowing bitcoin.