Tesla stops accepting Bitcoin payments
Elon Musk, chief executive of electric car maker Tesla (Tesla), cited environmental concerns in a tweet on Wednesday and will stop accepting Bitcoin payments.
Musk said on Twitter: “We are worried about the rapid use of fossil fuels in Bitcoin mining and trading, especially coal, which has the worst emissions of all fuels.” He added that cryptocurrency is “on many levels.” It’s a great idea, but its promise can’t come at the cost of “huge damage to the environment”.
He added that Tesla will not sell any bitcoins it owns.
After Musk made a comment on Twitter, the price of Bitcoin fell by about 5% to $51,847. Tesla shares closed down 4.4% on Wednesday.
Tesla said in February that it had invested about $1.5 billion in Bitcoin and planned to begin accepting the digital currency as payment “soon.” According to the securities filing, as of March 31, the fair market value of Bitcoin held by Tesla was $2.48 billion.
Bitcoin exists by relying on computers that rely on electricity. The number of computers and the energy required to power them are increasing, and the increase in the value of Bitcoin is directly related to the energy used.
Bitcoin miners unlock Bitcoin by solving complex and unique puzzles. As the value of Bitcoin rises, the puzzles become more and more difficult, and more computer power is needed to solve these puzzles. Estimates of how much energy Bitcoin uses will vary.
A study conducted by researchers from the Technical University of Munich and the Massachusetts Institute of Technology in 2019 concluded that at the end of 2018, the entire Bitcoin network could generate up to 22.9 million tons of CO2 per year, which is comparable to Western cities or the entire Western cities are similar to developing countries like Sri Lanka. Last year, the total global greenhouse gas emissions caused by the burning of fossil fuels was approximately 37 billion tons.