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Telsa suspends Bitcoin payments causing BTC’s price to crash

Elon Musk cited environmental concerns for Tesla's decision to halt accepting BTC as payment.

Tesla CEO Elon Musk / Image by: Wikimedia Commons

Thu, 13 May 2021, 04:29 am UTC

Bitcoin’s (BTC) price took a beating as one of the biggest corporate names that have recently adopted the crypto as payment retracted its decision. Tesla, which recently started accepting Bitcoin as payment for its cars, announced that it has suspended the option at the moment.

The announcement was made by Tesla CEO Elon Musk. “Tesla has suspended vehicle purchases using Bitcoin,” he posted on Twitter.

Musk cited environmental concerns to halt the crypto payment option. “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 added. “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.

However, it appears that Tesla isn’t totally ruling out the possibility of reaccepting BTC in the future once the crypto’s carbon emission issue is solved. In the meantime, the company is scouting for other cryptocurrencies that are less harmful 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,” Musk explained. “We are also looking at other cryptocurrencies that use <1% of Bitcoin’s energy/transaction.”

There were speculations that Tesla might be planning to accept Dogecoin as a payment option alongside BTC. Musk set up a poll on Twitter asking the social media platform’s users if they want Tesla to accept Doge. The responses were overwhelmingly positive as 78.1 percent of the poll’s participants are amenable to the idea.

Tesla first hinted at accepting BTC as payment in a SEC filing in February. “We invested an aggregate $1.50 billion in bitcoin under this policy and may acquire and hold digital assets from time to time or long-term,” Tesla said in its filing. “Moreover, we expect to begin accepting bitcoin as a form of payment for our products in the near future, subject to applicable laws and initially on a limited basis, which we may or may not liquidate upon receipt.”

The payment option was later confirmed by Musk in a tweet in March. “You can now buy a Tesla with Bitcoin,” he announced.

Musk’s announcement sent Bitcoin’s price falling. BTC traded at 50,952.98 at the time of writing based on Coinmarketcap data.

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