The change in policy has coincided with a market dip that some have attributed to the decision.
No More Bitcoin
Tesla has decided to suspend the acceptance of Bitcoin as a form of payment, with concerns about trasnaction mining being the primary cause of the decision.The CEO of Tesla, Elon Musk, took to Twitter on Wednesday to drop the new development. According to him, the need to suspend customers’ use of Bitcoin to purchase Tesla’s vehicles was because of environmental concerns. He said in the release:
“We are in search of other cryptocurrencies that make less use of BTC’s energy/transaction.”
The use of fossil fuels is reaching appalling numbers for BTC mining, and Tesla is looking to use other cryptocurrencies that utilize less than 1% of what Bitcoin consumes. However, Tesla plans to continue using BTC as soon as mining becomes sustainable, and will not attempt to sell their BTC holdings.
What Does It Mean For Bitcoin?
The decision to accept Bitcoin as a form of payment was issued back in March. Mining Bitcoin can come with a lot of extensive processes. The top digital asset is created when two complex machines compete to solve complex mathematical puzzles. This process requires a large number of fossil fuels, particularly coal, to generate electricity.
Data obtained from the University of Cambridge and the International Energy Agency shows that at the present rate, Bitcoin mining consumes a similar amount of energy to that of the Netherlands in 2019 annually. Before Tesla accepted Bitcoin as a form of payment in March, the vehicle company purchased BTC worth $1.5 billion in February. This move increased the adoption of cryptocurrencies by different industries as demand for BTC rose by 20% after the decision.
However, the recent developments may lead to a decline in BTC’s adoption. Although it may be short-term, given that Tesla intends to continue accepting Bitcoin immediately the energy consumption is sustainable, the suspension has reduced the appeal of the coin for many.
A senior marketing analyst at OANDA, Edward Moya, praised Elon Musk’s decision, stating:
“The environmental impact from mining bitcoins was one of the biggest risks for the entire crypto market.”
Head of research, Broker Pepperstone, disclosed that Elon Musk’s decision is a massive blow to Bitcoin. However, it explains the frailties of the top cryptocurrency.
BTC’s Environmental Impact
Speaking on the environmental impact of the most significant cryptocurrency asset, Moya was quick to point out the ignorance of individuals regarding the energy consumption of Bitcoin. He said:
“Over the past couple of months, many disregarded the news that Bitcoin uses more electricity than Norway and Argentina.”
Weston also spoke about the environmental impact of Bitcoin. In his words:
“Tesla has an image of being environmentally friendly, but Bitcoin is the opposite of that.”
Bitcoin, as well as other crypto assets, have a promising future, but Musk (and Tesla by extension) have made it clear this future will not hamper clean technology. Whether this is based on environmental concern or savvy progressive business positioning remains to be seen, but BTC has seen negative consequences regardless of the reason.
Source : bsc.news
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