(TheLibertyRevolution.com)- On Wednesday, Tesla CEO Elon Musk announced that Tesla would no longer be accepting bitcoin as payment only three months after announcing that they would.
Musk explained the move on Thursday citing environmental concerns.
“We are concerned about rapidly increasing use of fossil fuels for bitcoin mining and transactions,” Tusk said, “especially coal, which has the worst emissions of any fuel.”
After Musk made this announcement, bitcoin’s prices dropped substantially. According to CNBC, as much as $365 billion was wiped out of the market as a result.
Other cryptocurrencies were also negatively affected.
In an effort to clarify his position, Thursday evening Musk tweeted out, “To be clear, I strongly believe in crypto, but it can’t drive a massive increase in fossil fuel use, especially coal.”
Bitcoin is not issued by a single entity like a central bank. Rather, it is maintained by a network of “miners” who use purpose-built computers that require a great deal of energy to solve complex mathematical puzzles in order for bitcoin transactions to go through.
According to a February article from CNBC, the amount of electricity bitcoin’s consumes is larger than some individual countries.
It is this enormous carbon footprint that concerns Musk, an advocate for carbon taxes and renewable energy.
The more successful bitcoin gets, the higher the energy consumption goes.
According to Andrew Hatton, head of IT at Greenpeace UK, “we’re largely powering 21st Century technology with 19th Century energy sources.”
“Their fast-growing hunger for electricity is just an early symptom of a much bigger problem to come,” Hatton said.
Like Musk, Hatton believes the solution is expanding the sources of “renewable” energy the world relies on.
“As online services become bigger and more complex,” Hatton explained, “the demand for computing power is bound to go up over the next few years, and that will require more energy.”
Even with the drop in the markets, bitcoin is still up over 400% from last year.
However, given the inherent energy consumption problem associated with bitcoin “mining,” it is possible that the market drop reflects a realignment with reality. Blaming Musk for the drop in this case is akin to killing the messenger.