Tesla stops accepting Bitcoin for vehicle purchases

Elon Musk Tesla Car

Shock U-turn! Tesla has suspended accepting Bitcoin for vehicle purchases. CEO Elon Musk went from evangelist to critic really quick, citing concerns about the environmental impact of the cryptocurrency.

Tesla started accepting Bitcoin in late March to great fanfare in the crypto community, but the company has reversed the decision just 49 days later.

The billionaire reversed his backing of Bitcoin on Wednesday, putting the change of heart down to the environmental concerns about the mechanism used to validate transactions. He has faced sharp rebukes over support for the digital currency from investors who prioritize ESG issues.

Musk made the announcement in a tweet:

His comment that Tesla was looking at other cryptocurrencies that use less than 1% of the energy needs of Bitcoin can be seen as a shot in the arm to digital currencies that use other, less power-hungry ways to validate transactions.

Musk further confirmed that Tesla will not be selling any Bitcoin, though he did not shed any light on how long the carmaker would hold onto the cryptocurrency. Or even if it planned to put any more of its spare cash into Bitcoin.

The company’s investors were surprised last month to discover that Tesla had sold part of its cryptocurrency holdings within weeks for a $101 million profit. Company officials described the sales of its currency as proof of its liquidity.

Nevertheless, the statement appears to mark a retreat from the use of Bitcoin in Tesla’s treasury operations, which had grown to $2.5 billion.

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