Bitcoin crashes as Tesla does a U-turn on the largest crypto

The Palo Alto-headquartered electric vehicle maker Tesla Inc (NASDAQ: TSLA) will stop using Bitcoin as payment mode for car purchases, CEO Elon Musk has said in a tweet. The price of Bitcoin, has since crashed by 15.8% and is trading below the US$50,000-mark.

In his statement, Elon Musk said that the decision was driven by environmental concerns. “We are concerned about rapidly increasing use of fossil fuels for Bitcoin mining and transactions, especially coal, which has the worst emissions of any fuel. Cryptocurrency 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,” he said.

He, however, was quick to add that cryptocurrencies have a bright future.

Musk’s tweet came in the wake of growing chorus of concerns over Bitcoin’s sizeable carbon footprint. It is said that one Bitcoin transaction churns out the carbon dioxide equivalent to more than 1.1 million VISA transactions.

Triggered by the Tesla boss’ tweet, Bitcoin crashed 15.8% to touch intraday low of US$47,720, before recouping partially. At the time of filing this copy, the digital asset was trading at US$50,424.89, down 11.78%.

The world’s largest cryptocurrency had received a major shot in the arm in February, when Tesla announced the purchase of U$1.5 billion worth of bitcoin, in a filing to SEC, adding that it may “invest in more of bitcoin or other crypto currencies in the future.”

Mr Musk has been one of the biggest proponents of cryptocurrencies in the corporate America. Not to mention, his constant tweets on Dogecoin have pushed up its prices by over 10,000%.