Bitcoin rates depreciate after Elon Musk stops accepting bitcoin for Teslacar purchases citing climate issues
The valuation of bitcoin has faced serious depreciation after industrial designer, innovator, engineer, and owner of SpaceX, Elon Musk, made the announcement that his company, Tesla would stop accepting Bitcoin for the purchase of Tesla’s vehicles. Elon Musk made this announcement on Twitter, and it doesn’t bode well for bitcoin.
The entrepreneurial tycoon stated that the escalating number of conventional fuels, such as coal, leveraged in the process of bitcoin mining, was a driving force behind the call to cease accepting bitcoin as a payment method. He also specified in his social media update that cryptos had an exciting future ahead of them, but that this shouldn’t carry significant consequences for the environment, which is already at a fragile state as we roll towards the quarter-way mark of the 21st century.
The decision influenced a large depreciation in the valuation of the planet’s most widespread crypto, resulting in the loss of >$300 billion in bitcoin’s market valuation. However, bitcoin recuperated 50% of these losses, a mere day after plummeting 17% when SpaceX and Tesla owner Musk made the announcement of bitcoin no longer being accepted as a means of payment.
The value of bitcoin appreciated to approximately $49,808. Following its drop from approximately $54,819 to to $45,700, which was the lowest point since the 1st of March. The drastic depreciation occurred after the two hours after Musk’s tweet.
Ethereum, the planet’s second most popular crypto, had to gain from bitcon’s stumble. It had previously reduced by 14% to $3,550, and it had a temporary appreciation to >$4000 again, after which it reduced to approximately $3,750.
SpaceX and Tesla owner Elon Musk described his worries about the leveraging of fossil fuels in the pursuit of bitcoin mining. Mining, which is executed by the users themselves, can be equated to finding the answer to a difficult mathematical calculation. The procedure is so complex that it eats up a lot of computational power, and hence, quite a lot of energy.
A majority of miners are present in China, where the majority of energy is still produced by coal-fired power generation. The University of Cambridge lately identified that the bitcoin network now leverages a larger quantity of energy than the entire nation-state of Argentina.
Detractors have also highlighted that Elon Musk’s efforts with his admirable SpaceX program are also very stressful for the planet, and may wind up having a long-term impact on temperatures on earth. His Falcon 9 Rocket leverages fossil fuels, primarily Rocket Propellant or RP-1, which is essentially a very refined variation of kerosene. If SpaceX accomplishes its goal of a rocket launch every fortnight, then the organization will be emitting approximately 4k tons of carbons into the earth’s atmosphere on an annual basis.
Another issue is the unique metals that are leveraged in Tesla’s product lineup. They typically find their way into your vehicles from environmentally corrosive mines, and undergo process in methods that are not very conducive to the environmental cause that Musk appears to be touting.
Unique metals exist in minimal quantities and they can only be discovered in out of reach locations. To get to these very minimal amounts of energy, workers have to shift a lot of earth. This variant of mining is executed primarily in the Jiangxi, a rare earth mine located in China. It is stated that workers go about digging eight-foot holes, into which ammonium sulphate is poured to cause the dissolution of the clay. Various environmentally corrosive acid baths, and a baking process in the end, ultimately unveil these unique metals which are needed for the production of Tesla’s vehicle lineup. These baking procedures, often executed in coal-fire furnaces, emit a large amount of CO2 into the earth’s atmosphere.
Four months back, Tesla made the announcement that it would be feasible to deal with bitcoins, following which Tesla made a $1.5 billion investment in the crypto. Following this investment, the valuation of bitcoin shot through the rafters. The organization does not intend to sell the bitcoins it obtained, but is currently researching other cryptocurrencies that leverage a lesser amount of fossil fuel energy. In other words, Musk is looking for his eco-friendly coin. Perhaps he should introduce one himself.