The universal genius Elon Musk has embarrassed himself violently with his statements about Bitcoin and made it clear that he did not understand Bitcoin. One could even accuse him of hypocrisy. But let’s take a step back and see how the Tesla founder unmasked.
Disclaimer: This article is a guest post. We would like to point out that the opinion expressed does not necessarily match that of BTC-ECHO.
In one Tweet Musk announced that Tesla would surprisingly discontinue Bitcoin as a payment option – only a month after the function was activated by the electric car manufacturer. Before that, Tesla caused a stir in the crypto space at the beginning of February when the company invested $ 1.5 billion in Bitcoin.
So now the U-turn. Musk cited the high “energy costs per transaction” and the associated waste of fossil fuels as the reason for turning away from Bitcoin. With this, Musk reveals that he did not understand Bitcoin. So time to give the Tesla boss a little tutoring.
Starting with the most important point: the power sources of mining. 78 percent of Bitcoin’s energy requirement is already generated from renewable energies. In order to achieve the highest possible margins, Bitcoin miners are looking for cheap energy sources, such as geothermal, wind, solar or water power. Bitcoin is moving away from fossil fuels and towards sustainable and natural electricity.
A look at power consumption also shows that Bitcoin has a marginal energy requirement compared to other financial systems. For example, the banking system needs about 2.34 billion gigajoules (GJ) a year to function. Bitcoin has an annual electricity consumption of 183 million GJ, i.e. a twelfth of what the big financial institutions of this world have to spend every year. In a study, Galaxy Digital also estimates the electricity consumption of the banking sector to be higher than that of Bitcoin.
Another flaw in Musk’s tweet is the statements about transactions. Bitcoin doesn’t need more electricity just because there are more transfers. Much more, the necessary energy is used to secure the network, completely independent of the number of transactions!
In general, it is questionable whether Musk is even allowed to be the moral leader when it comes to energy consumption and sustainability. Because Tesla’s electric motors, batteries and touchscreens are not made from air and love, but from raw materials such as lithium and cobalt. The background to the extraction of these resources is well known. Then there is the CO2-Emission that Musk’s SpaceX rockets cause with every take-off and landing.
After his Twitter antics, the image of the Tesla boss has changed in the crypto community. Away from the celebrated hero, towards the bogeyman. For rehabilitation, Elon Musk would first have to admit that he was wrong about Bitcoin.
About the author
Marc Friedrich is Spiegel bestselling author, financial expert, sought-after speaker, thought leader, free spirit and founder of the fee-based consultancy Friedrich Vermögenssicherung GmbH for private individuals and companies. In his new guest commentary, he deals with what Elon Musk said about Bitcoin.
Marc Friedrich’s new bestseller: The Greatest Opportunity Ever – What We Must Learn From The Crisis Now And How You Can From The Greatest Vermögene transfer benefit humanity
More information at https://friedrich-partner.de as well as on Twitter and Instagram: @ marcfriedrich7