Previously, Tesla suspended the option to purchase an electric vehicle with Bitcoin after adding the option in March. Elon Musk said that the move was due to concerns about the energy used to process Bitcoin payments using computing power in a process called mining. Now Musk says that Tesla might reinstate Bitcoin payments if Bitcoin miners can switch over to at least 50% “green” renewable energy in their mining operations.
Some cryptocurrency miners have called his concerns unwarranted. The excuse of energy usage could be a cover for lack of purchases of Tesla vehicles using Bitcoin, as it isn’t used for payments much anymore due to high transaction fees and the pressure to HODL, or hold on to Bitcoin in the hope that it will increase in value despite price moves that can seem like a roller coaster at times. A few miners did mention the irony that Tesla vehicles run on electricity despite investments in solar powered Supercharger stations and attempts to ramp up sales of the company’s Powerwall and Powerpack batteries.
Many Bitcoin miners already seek out inexpensive renewable energy sources to maximize their profits. Norway has reported increasing demand for renewable energy from owners of mining rigs that may put a strain on its ability to produce enough energy to meet the total demand, for instance.
Elon Musk has recently met with major North American cryptocurrency mining firms regarding energy usage, a move that led to the formation of the Bitcoin Mining Council. The Bitcoin Mining Council says that it will push for greater transparency in energy usage. However, it does not appear that Musk will play a major role in the new organization.
In the wake of Tesla’s suspension of Bitcoin payments, supporters of other cryptocurrencies have suggested that the company could add cryptocurrency options that use less energy to process payments. Dogecoin was one of the most popular suggestions, since Musk has previously promoted it on Twitter and in an SNL skit during his guest hosting gig.
Although Tesla previously revealed ownership of $1.5 billion in Bitcoin in recent regulatory filings, the company has since sold $272 million in “digital assets” to cover operating expenses. Musk says that some of the sales were an attempt to “confirm BTC could be liquidated easily without moving market.” It may or may not have worked, considering that Bitcoin and several major altcoins like Dogecoin have slid starting on the day that Musk appeared on SNL.
Musk’s tweeting about cryptocurrencies often has an impact on the market. Some cryptocurrency investors have accused him of manipulating crypto markets, just as the SEC has alleged that Elon Musk manipulated the value of Tesla stock through ill-considered tweets such as claiming that he could take Tesla private, something that he later admitted would be “impossible at current prices” in the wake of the stock’s 2020 gains.
Several members of Reddit’s cryptocurrency subreddits have suggested ignoring Musk as much as possible. However, Musk’s most recent comment appears to have had limited effect, as Bitcoin rose 8% on Sunday.
And, yes, Musk does still plan to send “DOGE-1” to the Moon.