Tesla has stopped accepting bitcoin as payment for its cars out of concern that it will contribute to greater consumption of fossil fuels, according to a statement CEO Elon Musk tweeted Wednesday. Tesla had only just started accepting bitcoin in late March.
Musk also said that Tesla will no longer sell any more of the $1.5 billion stash of bitcoin it purchased earlier this year. Tesla sold some of that bitcoin in the first quarter of 2021, which wound up helping pad the company’s quarterly profit figures.
Tesla says it would resume accepting bitcoin (and would consider selling more of it) once the process of mining bitcoin “transitions to more sustainable energy,” according to the statement. The company is also “looking at other cryptocurrencies that use <1% of Bitcoin’s energy/transaction.” As of this writing, Tesla’s website indicates it will still accept Bitcoin for transactions.
“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,” Musk’s statement reads.
Bitcoin uses up as much electricity annually as the Netherlands, according to one estimate. All that energy comes with a huge carbon footprint. And there’s no simple fix because the blockchain that the cryptocurrency is built on is purposely energy inefficient. That clashes with Tesla’s mission to “accelerate the world’s transition to sustainable energy.”
Musk has also hyped another cryptocurrency, Dogecoin, which Tesla has not invested in. Musk has called Dogecoin, which was invented as a joke to satirize bitcoin, his favorite cryptocurrency and “the people’s crypto.” The cryptocurrency’s worth plunged after Musk called it a “hustle” on Saturday Night Live. Bitcoin’s value has similarly plunged about 4 percent after today’s Musk tweet, to $52,593.46 at 6:21PM ET from $54,829.14 at 6:06PM, according to Coindesk.