In today’s episode of the power of the influencer-entrepreneur Elon Musk, the value of Bitcoin surged by 25% in a day after Musk tweeted about $1.5 billion worth of investment in the cryptocurrency by Tesla. This revelation was followed by another groundbreaking announcement that Tesla is now planning to accept bitcoins as the mode of payment.
The value of the cryptocurrency has surged by 800% since April 2020. However, it is the matter of capitalism’s dilemma that the company that makes eco-friendly electric vehicles, has decided to invest in the digital currency which involves extensive energy consumption to be mined.
Capitalism’s Dilemma- Environment Friendly Company, Anti-Environment Investment
When Elon Musk sets a trend, the world blindly follows. This time, the CEO of eco-friendly car manufacturing company, Tesla, shot the investment in digital currency bitcoin. According to expert estimations, a boost in the global use of bitcoin as a currency will lead to more pollution than what small countries generate every year currently.
Bitcoin might not be made of paper, metal or any other tangible matter. However, the process of mining the bitcoin involves high power-consuming computers that solve complex mathematical equations and puzzles. These computers operate on the fossil fuels like coal, leaving behind massive carbon footprints.
According to the International Energy Agency, the current state of bitcoin mining consumes the same level of energy as used by Netherland in the entire 2019.
Another study by the journal Joule states that the process of bitcoin mining will involve 22-22.9 tons of CO2 emission every year.
The trailblazer of eco-friendly technology Tesla has invested billions in bitcoin and this only compromises with the zero-emission ethos of the organization. When the world is increasingly talking about the need to curb the climate-change threat that awaits humanity in the future, eco-friendly Tesla has vested its support to the most energy-intensive currency.
To quote Ben Dear, CEO of Osmosis Investment Management, “We are of course very concerned about the level of carbon dioxide emissions generated from bitcoin mining,”
“We hope that when Tesla’s bitcoin ventures are over, they will concentrate on measuring and disclosing to their market their full suite of environmental factors, and if they continue to buy or indeed start mining bitcoin, that they include the relevant energy consumption data in these disclosures.”
Looking At The Brighter Side– Elon Musk Might Change Bitcoin For Good
Elon Musk is a revolutionary and is famous for turning tides, wherever he goes. Another way of looking at Tesla’s decision to invest in bitcoin is that Elon Musk might take the baton of finding out a more sustainable method to mine bitcoins. If that happens, the world would have another reason to thank Musk.
Financial institutions and activists are already trying to find out more eco-friendly route to mining bitcoins. Just a few days ago, Musk contributed $100 million to eliminate CO2 percentage from the atmosphere.
Tesla is a big brand and Musk is the poster-boy of green technology. If Musk maintains the fame, the entry of such giants in the bitcoin industry might as well introduce the world to the “green bitcoin” concept.
So far, Tesla has refused to make any comment on whether it has an explanation for an eco-friendly company investing in the energy-intensive currency. However, looking at the company’s graph, the world is expecting environmental responsibility from the automobile giant.
Elon Musk’s Twitter Stunts
Tesla CEO previously tweeted about Dogecoin, a crypto-currency based around the Shiba Inu dog. Elon talked about Dogecoin in two tweets over the course of a week. Tweeting about one crypto-currency service months before investing in Bitcoin is quite peculiar.
A month ago, Tesla revised its investment strategy to diversify cash assets that aren’t important for working liquidity. These holdings swelled after selling billions of dollars for new stocks. In turn, Tesla soared to almost $20 billion compared to its $6 billion rates at the end of 2020. While some might credit this to their deals with Bitcoin, others are unsure whether Elon Musk is a great example to be followed or not.
So far it seems that Elon Musk is an advocate for cryptocurrency, whether it’s Bitcoin or Dogecoin. His recent investment also made JP Morgan analysts dub Bitcoin with the ‘highest bubble score’. Due to his quick thinking and investments, Tesla’s market capitalization is double in contrast to companies like BMW and Ford.
Is Bitcoin the right choice?
Tesla isn’t the only company that vouches for or has invested in Bitcoin. Previously PayPal launched software that allows its users to sell and buy bitcoins. Square, another fintech company, has made a purchase of $50 million. Square did so by saying that Bitcoin is the future of online/ internet money.
Due to Tesla being a new edition of Bitcoin’s list of supporters, the general public and smaller businesses will push themselves to also invest in the crypto asset. Whether it’s one percent or ten percent, corporations will eventually add Bitcoin into their investment plans. This will benefit both Tesla and Bitcoin due to numerous investments.