Bitcoin, the leading cryptocurrency, has achieved a significant sustainability milestone, aligning with Tesla CEO Elon Musk’s requirement for resuming its uptake for vehicle payments. Recent findings by Bloomberg Intelligence suggest that the energy mix used by Bitcoin miners constitutes a benchmark 50 percent from sustainable sources.
Tesla’s contentious relationship with Bitcoin has seen notable ups and downs. In February 2021, the electric car manufacturer sparked a sensation in the crypto arena by investing a staggering $1.5 billion in Bitcoin and validating its use as a payment method. This move drove the Bitcoin price to unprecedented heights, peaking at $44,200. Currently, Tesla retains over 9,000 bitcoins in its corporate treasury, ranking it the third-largest public Bitcoin holder globally, with a value of $259 million.
However, by May 2021, the company reversed its stance, announcing the suspension of vehicle purchases using Bitcoin due to environmental concerns. Musk cited an escalating reliance on fossil fuels, particularly coal, for Bitcoin mining and transactions, leading to a significant carbon footprint. He signaled that Tesla would only reinstate Bitcoin payments once its energy consumption was considerably cleaner.
The crucial benchmark cited by Musk was, “confirmation of reasonable (50%) clean energy usage by miners with a positive future trend.” Based on extensive scrutiny of bitcoin’s energy mix, which is notoriously challenging to quantify, Bloomberg Intelligence suggests that this time may have arrived. Their latest analysis indicates that Musk and Tesla could be gearing up to fulfill their previous commitment to Bitcoin.
A note distributed on the Bloomberg Terminal, titled “Bitcoin’s Energy Narrative Reverses as Sustainables Exceed 50%,” depicts Bitcoin mining as a driving force behind global decarbonization. The note dispels earlier contentions about Bitcoin’s unsustainable carbon footprint and hails an emerging trend of improved data transparency in this regard.
If the claims of improved clean energy usage are accurate and the trend continues to be favorable, prospects are high that Musk and Tesla will restart Bitcoin payments. This move is likely to trigger a positive response in Bitcoin prices, similar to the initial endorsement, signaling another game-changer for the volatile cryptocurrency market.
