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Tesla dodges bitcoins

May 13, 2021.

Tesla Gigafactory 3, Pudong District, Shanghai.

Tesla Gigafactory 3, Pudong District, Shanghai. © iStock.

The carbon footprint of using bitcoins to buy a Tesla is so large that it wipes out the car’s zero-emissions environmental benefit. Tesla CEO Elon Musk announced on Wednesday that Tesla will stop accepting bitcoin as payment for the company’s electric vehicles. This policy change comes less than two months after the automaker began accepting cryptocurrency. Why this about-face? Musk says he’s mindful of the environmental consequences of bitcoin. “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,” Musk wrote in a tweet, which immediately lowered the value of bitcoin by 4%. Musk nevertheless leaves the door open to other cryptocurrencies with a lower carbon footprint. “We are also looking at other cryptocurrencies that use < 1% of Bitcoin’s energy/transaction,” he wrote. “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,” Musk’s statement reads.

According to the Cambridge Bitcoin Electricity Consumption Index (CBECI), the cryptocurrency uses 149.63 TWh per year based on its current value, which is equivalent to the power consumed in Egypt (with 100.5 million inhabitants). And there is no easy solution, because the blockchain that underlies the cryptocurrency is designed to be purposely energy inefficient, which defeats Tesla’s mission to “accelerate the world’s transition to sustainable energy.”

Ars Technica, Tim De Chant, “Musk: Bitcoin is bad for climate (and you can’t buy Teslas with it anymore).”

2021-05-13