Tesla has reversed its policy on Bitcoin, and is no longer accepting the cryptocurrency due to the environmental problems it raises.
Premium electric car manufacturer Tesla made a bombshell announcement just a few weeks ago that it would accept the cryptocurrency Bitcoin in payment for its vehicles. However, it has now reversed that policy due to the environmental concerns raised by the massive energy consumption it requires.
Elon Musk, CEO of the company, announced the policy reversal on his Twitter account:
In the statement, Musk wrote that the manufacturer is “concerned about rapidly increasing use of fossil fuels for Bitcoin mining and transactions, especially coal”, and that the supposed benefits of cryptocurrency “cannot come at great cost to the environment”.
CNBC reported that as much as $365 billion was wiped off the cryptocurrency market following this announcement.
It’s not surprising that a brand associated with clean energy now wants to distance itself from the cryptocurrency that consumes more electricity than the entirety of Argentina; the mystery is why the policy was announced in the first place without this forethought, and whether the company simply is beholden to Elon Musk’s eccentric whims rather than having a corporate strategy.
Over the past week, the billionaire CEO has announced a SpaceX mission to the moon funded by Dogecoin (another cryptocurrency, this one fitted with a dose of comic irony), and he also hosted Saturday Night Live, starring in a series of bizarre sketches including one which saw him dress up as Mario’s arch-rival Wario.
Regardless of these eccentricities however, Tesla continues to perform very well, with the company’s Model 3 recorded as the most-registered car in the UK in December. In general, things are only looking up for electric cars, as they are forecast to become cheaper than fossil fuel counterparts by 2027.