Elon Musk responds after sending Bitcoin price plunging with Tesla tweets
Elon Musk has tweeted to “clarify speculation” after his posts sent the price of bitcoin and other cryptocurrencies plunging.
The Tesla chief executive had sent a tweet that some had read as suggesting that it had sold its vast bitcoin holdings.
“To clarify speculation, Tesla has not sold any Bitcoin,” he wrote in reply to one person who pointed to the considerable impact his posts had on the price.
Initial speculation came after Mr Musk posted a cryptic, one-word tweet in reply to a post about Tesla’s holdings.
“Bitcoiners are going to slap themselves next quarter when they find out Tesla dumped the rest of their bitcoin holdings,” the account CryptoWhale had written. “With the amount of hate Elon Musk is getting, I wouldn’t blame him…”
Mr Musk wrote only “indeed” in reply to the post. Many took that to be confirmation or at least a hint that the first part of the tweet was true, and Tesla had sold off its bitcoin holdings.
That sent the price of bitcoin and other cryptocurrencies plunging further, after an already negative week. Bitcoin has lost 8.7 per cent over the last day, and the crypto market as a whole has lost 9 per cent over the same time period.
Tesla bought $1.5 billion of bitcoin holdings in February, though its value has been volatile as the price has fluctatued, and it has at times made far more from its stake than through its cars.
As well as meaning that it holds a considerable part of the bitcoin that is available, it has also become the most prominent company to invest in the cryptocurrency, helping drive the price up when its announcement was made.
The latest speculation comes after Mr Musk publicly soured on bitcoin, announcing that Tesla would stop accepting it in payment for cars. The decision was made amid fears about the climate impact of the cryptocurrency, he said, and sent the price plunging.
But when he made that announcement, he had committed that Tesla would keep the bitcoin holdings that it already had.
“Tesla has suspended vehicle purchases using Bitcoin,” the statement, tweeted from Elon Musk’s account, read. “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 a 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 more sustainable energy. We are also looking at other cryptocurrencies that use <1% of Bitcoin’s energy/transaction.”