27 votes

Elon Musk announces that Tesla will no longer accept Bitcoin for vehicle purchases citing the energy demand required to maintain the cryptocurrency

@Elon Musk:
Tesla & Bitcoin pic.twitter.com/YSswJmVZhP

22 comments

  1. [16]
    gpl
    Link
    This is a surprising about-face from just a week ago when he agreed with @jack (twitter founder) that bitcoin incentivizes clean energy development. I wonder what the catalyst us. I wouldn't be...

    This is a surprising about-face from just a week ago when he agreed with @jack (twitter founder) that bitcoin incentivizes clean energy development. I wonder what the catalyst us. I wouldn't be surprised if this is just a way to drive the Doge hype given that SpaceX just announced the whole we're-accepting-doge thing.

    12 votes
    1. [3]
      MimicSquid
      Link Parent
      Step 1: Buy Bitcoin. Step 2: Announce you've bought Bitcoin, making Bitcoin rise. Step 3: Sell Bitcoin. Profit. Probably also short Bitcoin. Step 4: Announce Bitcoin is old and busted. Step 5:...

      Step 1: Buy Bitcoin.
      Step 2: Announce you've bought Bitcoin, making Bitcoin rise.
      Step 3: Sell Bitcoin. Profit. Probably also short Bitcoin.
      Step 4: Announce Bitcoin is old and busted.
      Step 5: Profit again.

      28 votes
      1. [2]
        Deimos
        Link Parent
        Matt Levine joked that he should do almost exactly that, back in February when they announced they bought the bitcoin:

        Matt Levine joked that he should do almost exactly that, back in February when they announced they bought the bitcoin:

        A funny thing for Elon Musk to do would be:

        1. Tesla Inc. buys some Bitcoin.
        2. Tesla announces that Bitcoin is good now and that it bought some.
        3. The price of Bitcoin goes up, because institutional adoption of Bitcoin is good for its price, but also because, by the Elon Markets Hypothesis, anything that Musk buys goes up.
        4. Tesla sells some Bitcoin, making a profit.
        5. Musk tweets that the price of Bitcoin is too high.
        6. Bitcoin prices go down due to the Elon Markets Hypothesis.
        7. Go to Step 1.

        You can’t do this forever; eventually people will notice that you are just cycling this around for your own profit. But you can do it for a while, particularly if you do a bunch of other distracting stuff—space rockets, flamethrowers, satin shorts—in between. 

        Anyway I am not saying that this is what Musk is actually doing. In particular I have no reason to think that Step 4 happened: Tesla announced that it bought Bitcoin last month but hasn’t said anything about selling it, and Musk seems to be a long-term believer. But Steps 1, 2, 3, 5 and 6 have happened, and I have no doubt that all of this will happen at least one or two more times (Step 7), so, you know. The trade is available to him, and it is funny, and he loves to do funny things, and what more do you need?

        13 votes
        1. [2]
          Comment deleted by author
          Link Parent
          1. Deimos
            Link Parent
            Yeah, this was a chart from a recent post by Scott Galloway - for Q1 2021, Tesla reported a $438M profit, but if you don't include selling emissions credits or their Bitcoin sale, they lost $181M....

            Yeah, this was a chart from a recent post by Scott Galloway - for Q1 2021, Tesla reported a $438M profit, but if you don't include selling emissions credits or their Bitcoin sale, they lost $181M.

            Link to the full source post: https://www.profgalloway.com/the-martian/

            11 votes
    2. [11]
      BlindCarpenter
      Link Parent
      I think Doge is a terrible investment, but I am curious how it compares to BTC in terms of required energy resources. Is it any better? There are already far better alternatives to Proof of Work...

      I think Doge is a terrible investment, but I am curious how it compares to BTC in terms of required energy resources. Is it any better?
      There are already far better alternatives to Proof of Work blockchains, so I am not advocating for Tesla to accept Dogecoin, it just seems inevitable at this point.

      3 votes
      1. [8]
        Diff
        Link Parent
        As I understand it, Doge is not a currency. So many new coins are minted daily that they will rapidly outstrip any actual interest in it, there's no scarcity. It's a joke, and it's built to be a...

        As I understand it, Doge is not a currency. So many new coins are minted daily that they will rapidly outstrip any actual interest in it, there's no scarcity. It's a joke, and it's built to be a joke. It's not really capable of not being a joke.

        7 votes
        1. [5]
          Amarok
          Link Parent
          It's more like crypto training wheels. It still operates like a crypto, but it doesn't cost any real money to play with it. One can get comfortable with exchanges, wallets, transfers, etc. It's...

          It's more like crypto training wheels. It still operates like a crypto, but it doesn't cost any real money to play with it. One can get comfortable with exchanges, wallets, transfers, etc. It's play money.

          8 votes
          1. [3]
            onyxleopard
            Link Parent
            Play money that somehow people are making enough real money from speculating on that they can quit their management job at Goldman Sachs.

            Play money that somehow people are making enough real money from speculating on that they can quit their management job at Goldman Sachs.

            9 votes
            1. [2]
              suspended
              Link Parent
              Wouldn't this be people that are the exception? So far, from what I've read and what has been explained to me by financial advisers, cryptocurrencies are incredibly risky.

              Wouldn't this be people that are the exception? So far, from what I've read and what has been explained to me by financial advisers, cryptocurrencies are incredibly risky.

              7 votes
              1. onyxleopard
                Link Parent
                Oh, yes, I’m sure this is not the norm, and I’m not saying this guy didn’t take any risk. It’s just a sort of amazing case study in the blurred distinction between “play money” and “real money”.

                Oh, yes, I’m sure this is not the norm, and I’m not saying this guy didn’t take any risk. It’s just a sort of amazing case study in the blurred distinction between “play money” and “real money”.

                3 votes
        2. skybrian
          Link Parent
          Yes, Dogecoin is a joke, but it's also a fully operational cryptocurrency that was created by forking software originally from Bitcoin and changing a few parameters. I thought it was a great...

          Yes, Dogecoin is a joke, but it's also a fully operational cryptocurrency that was created by forking software originally from Bitcoin and changing a few parameters. I thought it was a great spoof, but in the end we discovered that when you cross a cryptocurrency with a joke, you get a cryptocurrency. Popularity made it real. That's how they all work.

          8 votes
        3. Akir
          Link Parent
          Well, people are spending real money to trade it, so it's not entirely without value. But because it's useless for actual purchases, I consider it to be even more of a ponzi scheme than other...

          Well, people are spending real money to trade it, so it's not entirely without value. But because it's useless for actual purchases, I consider it to be even more of a ponzi scheme than other cryptocurrencies. It's basically like a stock exchange except there's no business component.

          3 votes
      2. skybrian
        Link Parent
        It looks like the block reward is fixed at 10k Dogecoin per block and 1 block per minute, so they're awarding 14 million Dogecoin a day to miners. At price of $.50 per Dogecoin (a bit higher than...

        It looks like the block reward is fixed at 10k Dogecoin per block and 1 block per minute, so they're awarding 14 million Dogecoin a day to miners. At price of $.50 per Dogecoin (a bit higher than now but from a few days ago) it's about $7 million per day in block rewards. So that's an upper bound on how much miners would spend on electricity per day to mine Dogecoin. It's probably around what Google uses.

        By contrast, Bitcoin is awarding about $50 million a day resulting in 10x Google's electricity usage.

        Just like with Bitcoin, the block rewards and electricity usage will fluctuate with market price.

        3 votes
      3. anothersimulacrum
        Link Parent
        I glanced at the thread, and saw a few charts listing dogecoin at 0.12 kWh per transaction with bitcoin at 707. I don't know if other differences between those currencies would cause that to be...

        I glanced at the thread, and saw a few charts listing dogecoin at 0.12 kWh per transaction with bitcoin at 707. I don't know if other differences between those currencies would cause that to be less meaningful than it appears at a glance.

        1 vote
    3. shiruken
      Link Parent
      I've seen some speculation that it's complicating their financials since Bitcoin car sales can't be counted as profits until converted to cash. It's an intangible asset otherwise.

      I've seen some speculation that it's complicating their financials since Bitcoin car sales can't be counted as profits until converted to cash. It's an intangible asset otherwise.

      2 votes
  2. jcdl
    Link
    The number of finance-bro-turned-crypto-grifters in that thread is staggering.

    The number of finance-bro-turned-crypto-grifters in that thread is staggering.

    8 votes
  3. [4]
    Bullmaestro
    Link
    Crypto is only good for money laundering due to the lack of audit trails and the fact that it skips many of the financial checks and safeguards that banks and national governments impose. That and...

    Crypto is only good for money laundering due to the lack of audit trails and the fact that it skips many of the financial checks and safeguards that banks and national governments impose.

    That and the fact that very few legitimate companies take cryptocurrencies as payment.

    Surprised they haven't been outlawed.

    2 votes
    1. [3]
      Comment deleted by author
      Link Parent
      1. Cycloneblaze
        Link Parent
        Relative to physical cash, yes, but it's very difficult to use cash for anything without linking it to the global financial system at some point, isn't it? That's why money laundering exists. With...

        relative to physical cash

        Relative to physical cash, yes, but it's very difficult to use cash for anything without linking it to the global financial system at some point, isn't it? That's why money laundering exists. With bitcoin, it is at least theoretically possible to remain completely anonymous and disconnected, and let other people handle the fiat money; it's also, judging by the prevalence of bitcoin as used on the black market, relatively easy. I wouldn't say it's only good for money laundering but it seems to be good for money laundering.

        Personally, I think the larger problem with how Bitcoin is used is that it's a speculative asset in an enormous bubble, and not anything close to a currency. But that is just how it's being used right now.

        3 votes
      2. Amarok
        Link Parent
        It's coming to many banks as well. It's within the realm of possibility that most banks and credit unions will be offering wallets for crypto as part of the usual checking/savings services within...

        It's coming to many banks as well. It's within the realm of possibility that most banks and credit unions will be offering wallets for crypto as part of the usual checking/savings services within a couple of years.

    2. guts
      Link Parent
      That only applies to Monero as it is the most proven private and fungible cryptocurrency.

      That only applies to Monero as it is the most proven private and fungible cryptocurrency.