EV maker cites concerns on cryptocurrency mining energy use, Tesla’s endorsement of Bitcoin in February powered rally
Tesla Inc.’s
Chief Executive Officer Elon Musk said the electric-vehicle
manufacturer is suspending purchases using Bitcoin, triggering a slide
in the digital currency.
In
a post on Twitter Wednesday, Musk cited concerns about “rapidly
increasing use of fossil fuels for Bitcoin mining and transactions,”
while signaling that Tesla might accept other cryptocurrencies if they
are much less energy intensive. He also said the company won’t be
selling any of the Bitcoin it holds.
The largest cryptocurrency dropped as much as
15% to just above $46,000, before paring some of the retreat. It was
down about 6% to $51,210 as of 7:03 a.m. in London on Thursday. Other
tokens such Ether and Dogecoin also slid. The rush to sell briefly
caused outages at some cryptocurrency exchanges. Bitcoin is still up
more than fivefold in the past year.
Musk’s move comes after Tesla disclosed
in February that it had purchased $1.5 billion in Bitcoin and planned
to accept it as a payment. That announcement added legitimacy to the
cryptocurrency as an increasingly acceptable form of payment and an
investment, especially coming from a large member of the S&P 500
with a high-profile CEO who commands a big following among retail
investors and the general public.
Bloomberg
© Bloomberg
Key
Hover over the blue highlighted
text to view the acronym meaning
Hover
over these icons for more information
Comments:
No Comments for this Article