Elon Musk issues blow to bitcoin as Tesla backs away from crypto purchases

This article was first published on Silicon Republiccryptocurrency – Silicon Republic

Electric vehicle-maker Tesla caused a stir when it announced earlier this year that it would begin accepting bitcoin for car purchases.

In February, the company said it had bought $1.5bn in bitcoin and that it could go on to acquire and hold more digital assets.

However, three months down the line, the company has pulled back on the cryptocurrency, announcing this week that it will no longer accept bitcoin for payment.

‘We are concerned about rapidly increasing use of fossil fuels for bitcoin mining’

Tesla CEO Elon Musk cited environmental concerns for the sudden volte-face.

“Tesla has suspended vehicle purchases using bitcoin,” he said in a statement released via Twitter.

“We are concerned about rapidly increasing use of fossil fuels for bitcoin mining and transactions, especially coal, which has the worst emissions of any fuel.”

Musk added that the company will cease any trading in bitcoin until these energy concerns addressed. “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 less than 1pc of bictoin’s energy per transaction.”

How does bitcoin affect the environment?

The mining of bitcoin involves the use of energy-intensive computing processes to solve complex mathematical problems.

According to the University of Cambridge Bitcoin Electricity Consumption Index, bitcoin mining consumes as much energy annually as a small country at 149.63 terawatt-hours. This is more than the annual electricity consumption of countries such as Sweden, Argentina and The Netherlands.

The source of this electricity, as with much of the electricity consumed around the world, relies heavily on fossil fuels.

In one case in the US, bitcoin has even driven the reopening of a previously abandoned power ...

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