In February, regulatory filings revealed that Tesla’s balance sheet included Bitcoin holdings that were then worth $1.5 billion. Earlier today, CEO Elon Musk announced that the company has sold 10% of those holdings.
Elon Musk’s long history with Bitcoin did include initial skepticism of the new form of currency. He had once been a co-founder of PayPal and may have thought that a fully digital coin, secured only by computing power, wouldn’t ever go mainstream. As recently as December 2020, Elon Musk has expressed skepticism regarding Bitcoin’s usefulness as a currency:
Some economists did echo Musk’s skepticism about Bitcoin, saying that it doesn’t have any intrinsic value. Its current price is simply based on people’s belief that it has value. Cryptocurrency enthusiasts have shot back that the U.S. dollar also hasn’t had any intrinsic value since the U.S. government quit backing it with gold.
Musk’s opinion of the cryptocurrency world as a whole is not completely negative, however. By February, he did seem to be slightly less of a bear about Bitcoin:
Musk has also expressed curiosity about Bitcoin transactions, added “CEO of Dogecoin” to his Twitter profile for a day, and set up a Dogecoin miner for his youngest son, X Æ A-Xii. On the business side, Tesla has added Bitcoin as a payment option for electric vehicle purchases.
Followers of other cryptocurrencies have called for Musk to add “altcoins” like Dogecoin and Bitcoin Cash, both of which come with lower transaction fees and may be better suited for smaller purchases like a cup of coffee and sandwich at local cafes. Backers of Bitcoin Cash like longtime cryptocurrency insider Roger Ver say that it is closer to Bitcoin creator Satoshi Nakamoto’s vision of a digital form of cash because it can scale better than the current form of Bitcoin.
Roger Ver on Bitcoin Cash
(It should be noted, however, that Bitcoin and Bitcoin Cash are incompatible. If you attempt to send Bitcoin to a Bitcoin Cash address or vice versa, you will permanently lose your funds.)
The company also runs full Bitcoin nodes, which store the blockchain-based ledger used by Bitcoin and helps to streamline cryptocurrencies’ functionality. Musk has not said whether he or Tesla does any cryptocurrency mining outside of X Æ A-Xii’s single Dogecoin miner, however.
Musk’s increasingly frequent and positive mentions of cryptocurrency is believed to be a factor in Bitcoin recently hitting all-time highs of over $60,000. Chatter among cryptocurrency enthusiasts seems to be generally positive even though some did note that Bitcoiners should not rely on Elon Musk to prop up the cryptocurrency forever.
On the flip side, it seems to have made him a magnet for cryptocurrency-themed scams. Fake Twitter accounts impersonating Elon Musk have promised a “Bitcoin giveaway” to viewers who sent them Bitcoin, a scam that cost one German man 10 Bitcoin, which was then worth almost $600,000. Besides the fake accounts floating around not only on Twitter, but also on Telegram and Instagram, the scammers once managed to actually hack Elon Musk’s Twitter account in order to promote their scam.
For now, Elon Musk seems confident enough in Bitcoin and cryptocurrency as a whole to have only sold 10% of Tesla’s holdings for what he claims are demonstration purposes.
Finally, Elon Musk had this to say, which could be a reference to one of the cryptocurrency community’s favorite sayings, NASA’s recent selection of SpaceX to develop the lunar lander for the Artemis Program, or both: