CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 70% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.
US English

Musk bans Bitcoin Tesla vehicle purchases

By Dan Moore

06:46, 13 May 2021

Tesla CEO Elon Musk

Elon Musk sent Bitcoin prices tumbling by 17% to $46,000 when he announced Tesla was suspending transactions using the cryptocurrency. Musk has expressed concerns about the environmental impact of using Bitcoin for vehicle purchases.

In a Tweet the Tesla CEO wrote: “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.”

A role for cryptocurrencies with Tesla

The word’s second richest man did not slam the door on all cryptocurrencies, though, reassuring his legion of Twitter followers that the company would be exploring the use of other cryptocurrencies that use less than 1% of Bitcoin’s energy-per-transaction.

Musk added on Twitter: “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.”

A recent report by Dutch economist Alex de Vries concluded Bitcoin’s carbon footprint is comparable with that of Slovakia, while a study from Cambridge University said Bitcoin uses more electricity than Argentina.

What is your sentiment on BCH/USD?

351.95
Bullish
or
Bearish
Vote to see Traders sentiment!

Trade Bitcoin Cash to US Dollar – BCH/USD CFD

1m
5m
15m
30m
1H
4H
1D
1W

Tesla’s Bitcoin interests

Musk’s announcement has been seen by some analysts as a U-turn designed to save face after criticism of the company for buying up $1.5bn worth of Bitcoin in February and stating the currency could be used to buy Teslas.

NVDA

140.24 Price
+2.950% 1D Chg, %
Long position overnight fee -0.0248%
Short position overnight fee 0.0026%
Overnight fee time 22:00 (UTC)
Spread 0.14

TSLA

258.75 Price
+6.660% 1D Chg, %
Long position overnight fee -0.0248%
Short position overnight fee 0.0026%
Overnight fee time 22:00 (UTC)
Spread 0.11

COIN

200.44 Price
+11.700% 1D Chg, %
Long position overnight fee -0.0248%
Short position overnight fee 0.0026%
Overnight fee time 22:00 (UTC)
Spread 0.47

SMCI

27.74 Price
+6.480% 1D Chg, %
Long position overnight fee -0.0248%
Short position overnight fee 0.0026%
Overnight fee time 22:00 (UTC)
Spread 0.12

While the company subsequently offloaded 10% of its Bitcoins, various positive messages on Twitter have been credited with boosting its market value. The latest message knocked Bitcoin’s share price, although it recovered some losses to $50,593 at early Thursday.

Similarly, Dogecoin shares fell 22% following a comment on US sketch show Saturday Night Live from Musk that the cryptocurrency was a “hustle”.

Tesla prices fall

Tesla shares closed down 4.42% on Wednesday at $589. The company still holds a significant amount of Bitcoin, which it had said it doesn’t not intend to sell.

In an earlier tweet aimed at people tempted to invest their life savings in the asset, Elon Musk wrote: “Cryptocurrency is promising, but please invest with caution.”

Read more: Cryptocurrency predictions 2021: will the growth continue?

Rate this article

Capital Com is an execution-only service provider. The material provided in this article is for information purposes only and should not be understood as investment advice. Any opinion that may be provided on this page does not constitute a recommendation by Capital Com or its agents and has not been prepared in accordance with the legal requirements designed to promote investment research independence. While the information in this communication, or on which this communication is based, has been obtained from sources that Capital.com believes to be reliable and accurate, it has not undergone independent verification. No representation or warranty, whether expressed or implied, is made as to the accuracy or completeness of any information obtained from third parties. If you rely on the information on this page, then you do so entirely at your own risk.

Still looking for a broker you can trust?

Join the 650,000+ traders worldwide that chose to trade with Capital.com

1. Create & verify your account 2. Make your first deposit 3. You’re all set. Start trading