Tesla stops taking bitcoin as payment due to increasing pollution: Explained

Investors as well as environmental activists had earlier cried foul about Tesla using bitcoins for payment and on Wednesday, Elon Musk tweeted about it.

By:Updated: May 13, 2021 11:32 AM
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Tesla which in March 2021 had announced that it will take bitcoins a payment for cars, has now stopped the practice. There is no operational reason but the very ethos that Tesla cars stand for and that is zero pollution. The electric car company which also happens to be the world’s most valued, has said that bitcoins are built using fossil fuels and due to which the level of emissions is quite high. Investors as well as environmental activists had earlier cried foul about Tesla using bitcoins for payment and on Wednesday, Elon Musk tweeted about it. You can check his tweet below

Elon said that his company is looking at alternative currency options that consume less than one per cent of the energy/transaction that Bitcoin uses. Bitcoin is a digital currency that is made when several high-powered computers match their potential against several machines to solve complex mathematical puzzles. This results in high expenditure of energy and the latter is generated via electricity which in turn is made through fossil fuels, especially coal. The Chinese dominate in this aspect and there are many bitcoin miners out there. Their reluctance to swap fossil fuels for renewable sources of energy is what is pulling the cryptocurrency values down. The renewable sources of energy, we are being told, are expensive when compared to fossil fuels and lead to less profit margins.

Bitcoin shares fell by around seven per cent after the tweet by Elon Musk. At present. Tesla is still mulling using other cryptocurrencies and Doge seems to be the forerunner for this according to a poll run by Elon Musk. Doge was created as a payment joke but quickly became famous and features the face of the Shiba Inu Japanese dog breed. While Bitcoin is claimed to have an upper limit, Doge doesn’t and is more widespread.

 

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