Tesla CEO Elon Musk announced Wednesday that the electronic car company would suspend vehicle purchases with Bitcoin, citing concern over “rapidly increasing use of fossil fuels for Bitcoin mining.”
“Tesla has suspended vehicle purchases using Bitcoin. 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,” wrote Musk.
“Cryptocurrency is a good idea on many levels and we believe it has a promising future, but this cannot come at great cost to the environment,” Musk continued. “Tesla will not be selling any Bitcoin and we intend to use it for transactions as soon as mining transitions to more sustainable energy. We are also looking at other cryptocurrencies that use <1% of Bitcoin’s energy/transaction.”
Tesla & Bitcoin pic.twitter.com/YSswJmVZhP
— Elon Musk (@elonmusk) May 12, 2021
In a subsequent tweet, Musk described the energy usage trend of Bitcoin in recent months as “insane.”
In response, up to $365 billion was “wiped” off the entire cryptocurrency market.
“At around 6 p.m. ET on Wednesday when Musk made the announcement, the value of the whole cryptocurrency market stood at around $2.43 trillion, according to data from Coinmarketcap.com. By 8:45 p.m., the market capitalization had dropped to around $2.06 trillion, wiping off around $365.85 billion,” reported CNBC.
“The market has since pared some losses, and by around 6.30 a.m. the cryptocurrency market had seen around $235 billion wiped off its value since Musk’s tweet. Bitcoin was down around 12% at around $49,624, according to CoinDesk data, dipping below the $50,000 mark for the first time since Apr. 24,” added CNBC.
The energy usage of cryptocurrency is not a new concern for environmentalists. As reported by The Daily Wire in February, “According to researchers at Cambridge University, in terms of annual energy consumption, Bitcoin now consumes more power than Argentina, the Netherlands, and the United Arab Emirates, at 121.36 TWh.”
“This surge in electricity consumption aligns with the meteoric rise of Bitcoin’s price, which has increased from $13,748 on November 1 to $46,517.40 on February 9. While much focus has been given to its price, experts are reportedly becoming increasingly alarmed by the ‘sheer level of energy required by so-called miners, which release new coins into circulation,’” reported The Daily Wire, adding, “According to Digiconomist’s Bitcoin Energy Consumption Index, a tool created by data scientist Alex de Vries, Bitcoin now has a ‘carbon footprint comparable to that of New Zealand,’ producing an estimated 36.95 megatons of C02 per year.”
Musk often has an impact on the price of various cryptocurrencies. On Saturday evening, Musk hosted “Saturday Night Live.”
Known as the self-proclaimed “Dogefather,” Musk discussed Dogecoin on multiple occasions during the show. However, during Musk’s episode of the comedy series, the price of Dogecoin plummeted, particularly after Musk joked that Dogecoin was a “hustle.”
Lloyd Ostertag stopped by the desk to talk cryptocurrency. pic.twitter.com/cuILxOBJlj
— Saturday Night Live – SNL (@nbcsnl) May 9, 2021
CNN reported, “After pumping up the value of the cryptocurrency in the lead-up to Musk’s SNL appearance, investors sold off dogecoin sharply after the Musks talked about it on the show. Dogecoin was down 40%, trading as low as 44 cents early Sunday. The cryptocurrency started Saturday trading at around 70 cents and was selling for about 66 cents just before SNL went on the air at 11:30 pm ET.”