Tesla Rejects Bitcoins: Won't Use Bitcoin As Payment, Because It's Bad For Earth

Elon Musk, who created a tsunami in the crypto world after allowing people to purchase cars using Bitcoin as a mode of currency has now taken a U-turn and announced that he won¡¯t be accepting them anymore.

Reuters

Also Read: Tesla Made More Money On Bitcoins Than By Selling Cars: Here's What Happened

The reason -- how Bitcoins are mined, consuming vast amounts of electricity that¡¯s mostly generated through fossil fuels like coal.

Musk said in a statement, "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."

Tesla & Bitcoin pic.twitter.com/YSswJmVZhP

¡ª Elon Musk (@elonmusk) May 12, 2021

In case you didn¡¯t know, Bitcoins are created when high-powered computers compete against other machines in order to solve complex mathematical problems. Miners have computer systems running all day to generate as much Bitcoin as they can, with utter disregard for electricity consumption.

To put things into perspective, according to the data from the University of Cambridge and the International Energy Agency, Bitcoin mining consumes the same amount of energy annually as the nation of Netherlands in the year 2019.

This move didn¡¯t sit well with Tesla shareholders as the shares saw a drop of 1.25 percent right after.

Also Read: Want To Invest In Bitcoin? Check Out These Secure Bitcoin Exchanges

It is important to note that Tesla in February this year ended up buying $1.5 billion worth of Bitcoin before he decided to make it as one of the payment methods for his electric car business. This move surprised conglomerates and Bitcoin holders around the world, resulting in a 20 percent surge in cryptocurrency.

What about the Bitcoin Tesla already owns?

Musk has offered some clarity on this too. He is going to retain its Bitcoin holdings and plans to use it when Bitcoin miners adopt a more sustainable route that doesn¡¯t involve fossil fuels harming the environment.

Reuters

Also Read: How To Invest In Bitcoin And Cryptocurrency In India, Here's Some Expert Advice

Musk also said in a tweet yesterday that the company still believes in cryptocurrency being the future. Moreover, he revealed that they¡¯re also looking at other cryptocurrencies that use <1 percent of Bitcoin¡¯s energy/transaction.

This comes just a day after he shared a poll on Twitter asking his followers if it would be a good idea to have Tesla accept Dogecoin as a payment option. Also a few days ago, he announced that SpaceX would accept Dogecoin as payment to launch a lunar mission next year.