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Tesla and Elon Musk cause brutal Bitcoin drop

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It was just over 8 hours ago that Elon Musk, as Tesla’s CEO, announced a turnaround that caused Bitcoin’s brutal fall, which reached as much as $ 49,940, in a decision contrary to the one recently taken by the car company.

Electric car maker Tesla will stop accepting Bitcoin as payment, CEO Elon Musk tweeted tonight, citing environmental concerns. “We are concerned about the rapidly increasing use of fossil fuels for mining and Bitcoin transactions, especially coal, which has the worst emissions of any fuel,” said Musk on Twitter. He added that cryptocurrency is a “good idea on many levels”, but his promise cannot come at a “great cost to the environment”.

Tesla, he added, will not sell any of the Bitcoins it owns. Bitcoin’s price fell about 5%, to $ 51,847, after Musk’s comments on Twitter. Tesla’s shares ended Wednesday with a fall of 4.4%, showing that investors also did not like this news very much.

Tesla said in February that it invested about $ 1.5 billion in Bitcoin and planned to start accepting digital currency as a form of payment “soon”, something that eventually happened in late March.

In the statement, Trsla also states that it intends to continue betting on cryptocurrencies, and continues to look at other currencies that use less than 1% of Bitcoin’s energy per transaction.

Bitcoin depends on computers, which depend on electricity, to exist. The number of computers and the energy needed to power them is increasing, with the increasing value of Bitcoin being directly related to the amount of energy it uses, with estimates of how much energy Bitcoin uses vary.

A 2019 study by researchers at the Technical University of Munich and the Massachusetts Institute of Technology concluded that, by the end of 2018, the entire Bitcoin network was responsible for up to 22.9 million tons of CO2 per year – similar to a large western city or an entire developing country city like Sri Lanka. Total global greenhouse gas emissions from burning fossil fuels were around 37 billion tonnes last year.

More recently, in a study of Digiconomist, points out that Bitcoin spends as much electricity as Argentina or the Netherlands.

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