Tesla stops accepting Bitcoin due to climate concerns – paultan.org

Earlier in the year, Tesla invested US$1.5 billion (RM6.2 billion; roughly 8% of its reserves) in Bitcoin, with CEO Elon Musk saying that the automaker will be accepting the cryptocurrency as a form of payment, the BBC reports.

However, just recently, Musk announced on Twitter that Tesla has suspended vehicle purchases using Bitcoin over climate change concerns. This caused the value of Bitcoin to plunge 10%, and Tesla’s shares also took a hit. “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,” he said.

“Cryptocurrency is a good idea… but this cannot come at great cost to the environment,” he added. Musk also said Tesla intends to use Bitcoin as a transactional exchange in the future, when Bitcoin mining shifts to using more sustainable energy. “We are also looking at other cryptocurrencies that use <1% of Bitcoin's energy/transaction," he continued.

An analysis made by BBC tech journalist Rory Cellan-Jones showed that the process of mining Bitcoin uses vast amounts of computer processing power (another reason for the global semiconductor shortage as demand for computer graphics card far outstrip supply). Mining like this “uses more electricity each year than Malaysia or Sweden and is closing in on the annual consumption of Egypt,” he noted.

A recent research shows that China is responsible for more than 75% of Bitcoin mining around the world, and its carbon footprint is as large as one of China’s 10 largest cities. This is because Bitcoin miners use coal-generated electricity to power their mining rigs, which are used to solve complex mathematical puzzles.

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