Elon Musk, Tesla’s chief executive officer, who recently added “technoking” to his title, said on Wednesday that the company would accept it Bitcoin as payment for cars in the USA a step that contradicts the company’s image as an environmentally friendly electric car manufacturer.
Tesla will hold the digital currency instead of converting payments to dollars and handle the crypto transactions in-house, Musk said.
“Bitcoin paid to Tesla will be retained as Bitcoin and not converted into fiat currency,” Musk said in a tweet. That said, if someone buys a Tesla with Bitcoin, the price of the car can go up or down over time. In other words, Tesla is converting one-time payments into assets with a shift in value or essentially investments.
Buyers outside of the US will have the option to use Bitcoin “later this year,” Musk said.
The acceptance of Bitcoin by Mr. Musk is welcomed by many cryptocurrency enthusiasts, but the impact of digital currency on climate change is increasingly being studied.
“Bitcoin uses more electricity per transaction than any other method known to man, so it’s not a great climate thing.” Bill Gates recently told the New York Times. Depending on studyThe annual carbon emissions from the electricity used to mine Bitcoin and process its transactions are equivalent to the amount emitted by all of New Zealand. Or Argentina.
There’s also an e-waste-related problem with bitcoin mining, argues Alex de Vries, an economist who created the company Bitcoin energy consumption index and tracks the unintended consequences of digital trends. Bitcoin mining is done with highly specialized equipment that has a short lifespan and the tools cannot be reused, which makes investing in the digital currency even more problematic from an environmental point of view, he told The Times.
Mr Musk said last month that the company bought Bitcoin worth $ 1.5 billion for its treasury. Wednesday’s announcement confirms speculation in the crypto community that Tesla would not simply make payments to a third party and treat Bitcoin like dollars.
Since Tesla bought Bitcoin in February, the price has been Bitcoin and other cryptocurrencies have soared to record highs, but trading has been volatile.
Analysts are happy at least with the symbolism. “This is a crucial moment for Tesla and the crypto world,” write Daniel Ives and Strecker Backe, analysts at the investment firm Wedbush. “This morning’s news formalizes Musk and Tesla’s strategy of delving into the deep end of the pool of bitcoin and crypto from a transactional perspective.”