You may have heard the news that Tesla is no longer accepting Bitcoin for their vehicle purchases. But why is that? How does it affect Bitcoin prices, and will Tesla ever accept Bitcoin again?
Let’s take a look!
Why Did Elon Musk Decide Against Bitcoin?
As per Elon’s tweet, which you can read above, “Tesla will not be selling any Bitcoin.”
But some say that Dogecoin, which Musk promotes currently, has a smaller impact than Bitcoin, but only because the value is a lot less. However, if they were the same size, the impact on the environment would be equally bad.
Also, at the time of writing, Dogecoin has jumped to its highest coin price, and its percentage growth now makes it the fourth-largest cryptocurrency.
As more and more people start investing in and mining Dogecoin, it will also impact the environment. In fact, it might even be worse than Bitcoin as more people can afford to mine Dogecoin compared to Bitcoin.
Bitcoin Price After Tesla’s Discontinuation
Bitcoin plunged 12 percent as of 6:50 a.m. ET on Thursday, 13 May after Elon Musk tweeted that Tesla will no longer accept it as payment. It is said that Elon’s move to stop Tesla’s car purchases with Bitcoin wiped off $365 billion from the cryptocurrency market.
By 8:45 p.m., the market capitalization had dropped from $2.43 trillion to around $2.06 trillion after Tesla’s announcement that it would no longer accept Bitcoin as a payment method.
Will Tesla Ever Accept Bitcoin Payments Again?
Elon said in his tweet: “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.”
To clarify speculation, Tesla has not sold any Bitcoin
— Elon Musk (@elonmusk) May 17, 2021
Tesla hasn’t sold their existing holdings. They’re just not accepting Bitcoin as a payment option right now. Given Musk’s statement regarding the environmental cost, the company is unlikely to begin accepting Bitcoin in the short-term, but ruling it out in the long term might be unwise.
Will This Step Ease up the Environmental Harm?
Even if the Bitcoin price decreases, it won’t make much of an environmental difference to Bitcoin’s footprint. Miners will continue to mine, regardless of price. In fact, the opposite might happen.
If more people start buying Bitcoin because of its dropping price, it may make things even worse for the environment because the prices then are unlikely to drop again this rapidly.
Do you want Tesla to accept Doge?
— Elon Musk (@elonmusk) May 11, 2021
Furthermore, instead of shifting to another cryptocurrency like Dogecoin, Elon should just drop the crypto support altogether, which would be more beneficial for the environment, or at the very least begin promoting a cryptocurrency with better environmental credentials, like NANO.
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