What has ELON said now!

When I arose this morning from my very comfortable sleep to do the usual nervous check of my crypto portfolio, I was stunned. The doge-father of all people had dropped another crypto based tweet saying the following :

" Tesla has suspended vehicle purchases using bitcoin. We are concerned about rapidly increasing use of fossil fuels for bitcoin mining and transactions, especially coal, which has the worst emission of any fuel.

Crypto currency is a good idea on many levels and we believe it has a promising future, but this cannot come at great cost to the environment.

Tesla will not be selling any bitcoin and we intend to use it for transactions as soon as mining transitions to a more sustainable energy. We are also looking at other crypto currencies that use <1% of bitcoins energy/transaction."

So........ why has Elon dropped this tweet? Is there a reason for a change of heart towards bitcoin? And is he being hypocritical or is he trying to show that improvements need to be made before crypto can be fully incorporated into the current businesses?

There is absolutely no doubt in my mind that Elon believes that crypto currency adoption into the future is a guarantee. His forward thinking mind has demonstrated in the past his keen eye to prevailing technologies through development of companies such as Paypal, Tesla and Space X. He has been involved the crypto scene for sometime now and was one of the first large public figure heads this year to explain that his company Tesla would be adopting bitcoin into there balance sheets. However by releasing this tweet, will it in someway help benefit himself in the long run?

The answer quite frankly is yes. He is obviously keeping his bitcoin as he has stated, so he believes its use case for the future. Maybe he is trying to convey in this instance that bitcoin may be important in the future as a hedge in the cryptocurrency markets, but that there are more sustainable methods on the blockchain for transactions at present, and also faster and more sustainable transactions will be more readily available moving forward. Reading his tweet it is very easy for the regular crypto ape to be scared, which as we have seen has caused a dip in the bitcoin price shortly after he tweeted. But reading between the lines he is trying to convey a very important point and that there are a few things to be taken away from his statement.

1.  Bitcoin is not the most sustainable crypto for transactions, in fact it is actually one of the more energy intensive currencies to mine. There are much cheaper/faster costs of transactions on other crypto currencies such as Ethereum, XRP, Cardano or to be honest most other blockchains. However these crypto currencies are all in an early stage, and blockchain technology is also in its baby stages. Moving forward business and people will invest in a variety of different currencies and there will be an increasing demand to do this more sustainably. One thing to take note is Elon recently mentioned he would be keen to take payments in Doge coin in the future (which again is a much more sustainable blockchain in comparison to bitcoin and its transactions/mining costs). This shows his over all macro perspective on the issue of crypto adoption and that he is looking for more sustainable methods that are not bitcoin for transactions within Tesla.

2. We know that Elon is often ahead of the curve on most things, and so is this his way of alerting his following that other crypto currencies will be used moving forward for transactions. If he had said that he was thinking about adopting another crypto for his transactions on company products this would in turn affect the market also. If he said for instance we are going to use XRP (which be aware is still going through lawsuit) for transactions this would send the price of XRP up in value artificially. It would also appear to give favourability to one type of crypto currency over the others which again in turn could cause a change in market price of that crypto. Therefor it is not in his best interest to specify the exact currency he would be happy to use moving forward for transactions within Tesla.

3. The 4 year cycle - This fact and the in-deniable fact that we are currently in the middle of a bull run will mean at some point the value of bitcoin will drop. Across the crypto-sphere and from my experience after the bull run finishes the price will drop. To what price is hard to say exactly but it will definitely drop in value. Many say the resistance value for the drop will be between 30k -50k mark (the price that Tesla bought their bitcoin at) and so is this a tactical move on this front? It would be wise to hold his bitcoin we know however with transactions happening over the next few months in a period of higher volatility in the market it would be safer to sit and HODL? In my opinion this is a wise move for Tesla and also help mitigate risk moving forward into the next few months.

4. Elon has his fingers in the renewable energy sector and also a passion for preservation of the planet. Are his intentions to use this energy source to mines crypto assets in the future? Maybe he is working behind the scenes as we speak! We also know in recent months his keen twitter support towards the community driven dogecoin meme coin has lead to price rise. Is this another example of where a proof of work crypto may become more energy efficient through community driven engagement into the future and further adoption?

In summary and from my experience I would say that the tweet this morning has caused a bit of panic. Again the media outlets are bumbling on about how bitcoin is so bad for the planet and various other false statements which has again helped resulted in a dip in the market. If anything hopefully his statement will make more of the general public aware of current issues environmentally with blockchain technology, and that over all it is a good point to be highlighted at present so moving forward we do our best to be as energy efficient as possible. I hope it causes people to start actually doing their own research and not listen to official news channels on this matter, or take them with a pinch of salt until they themselves truly understand what they are writing about. Bitcoin adaption was required initially, and now it is in the main light we can educate people on how blockchain technology can improve our environmental standards across the planet.

Again as always thanks for reading and I wish you all the best.