Bitcoin surges after Elon Musk’s indication to resume payments through it

Summary 

  • Elon Musk owned Tesla stated it would most likely resume accepting Bitcoin as a form of payment
  • However, Musk plans to conduct further due diligence to ensure Bitcoin’s renewable energy consumption
  • Bitcoin and other cryptocurrencies prices surged following the announcement
  • The move is a sharp reversal from Musk stopping Bitcoin payments in May, citing environmental concerns

Electric vehicle major Tesla (LON: 0R0X) indicated on 21 July that the company plans to resume cryptocurrency Bitcoin as a form of payment depending upon Bitcoin’s renewable energy usage compared to its total energy mix, leading to a rally in Bitcoin’s and other cryptocurrency prices.  

The company’s CEO and founder, Elon Musk however, added in a caveat that it plans to undertake some due diligence related to Bitcoin’s renewable energy consumption to confirm whether it accounts for at or over 50 per cent of renewable energy use.

Musk also asked to ensure that Bitcoin’s clean energy consumption had an upward trendline as well, prior to resuming Bitcoin as a payment method.

The most popular cryptocurrency, Bitcoin (BTC) was trading at around US$ 32,160.16, sharply up by 8 per cent soon after the announcement.

 

Musk’s crypto outlook

Bitcoin prices were further bolstered after Musk announced that one of his other companies, privately owned space firm SpaceX, also owned Bitcoin and other cryptocurrencies.

Moreover, the billionaire founder of Tesla and SpaceX added that he personally owned cryptocurrencies including Bitcoin, Ethereum and Dogecoin, citing he had a long-term position for Bitcoin.

Musk has previously faced criticism for his changing stance on Bitcoin, which caused market crashes in digital currencies.

Also Read: Decoding Musk’s bittersweet relationship with Bitcoin

 

Musk’s changing stance on Bitcoin

The latest development is in sharp contrast to Musk’s earlier stance and comes just two months after Musk had said in a tweet in May that Tesla would stop accepting Bitcoin as a payment method by citing concerns over its large energy consumption and impact on the environment.

Musk had previously lauded Bitcoin as a cryptocurrency and announced he had invested up to US$ 1.5 billion in it.

 

Cryptocurrencies rebound

The largest cryptocurrency by market cap, Bitcoin (BTC) was trading at around US$ 32, 043.49 on 22 July at 06:35 AM GMT+1, up by 3.92 per cent, following the announcement and an all-round positive sentiment surrounding the cryptocurrency.

BTC’s market capitalisation stood at US$ 601.07 billion, and its year-to-date returns were at 9 per cent.

Meanwhile, Ethereum (ETH), the second largest cryptocurrency by market cap, was trading at around US$ 1,983.81, up by 5.53 per cent as of 22 July at 06:58 AM GMT+1, was also positively impacted by the news.  ETH’s market capitalisation stood at US$ 231.79 billion, and its year-to-date return was at 167.10 per cent.

Other key digital currencies which were buoyed by the news included XRP, which was trading at US$ 0.588781, up by 7.34 per cent and Cardano, which was trading at US$1.18, up by 3.99 per cent.

Also Read: Why is Cryptocurrency popular? Will Ethereum overtake Bitcoin?

 

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