What does Elon Musk have to say about Bitcoin?

02 Mar, 2019
by Joeri Cant
Analysis
What does Elon Musk have to say about Bitcoin?

Who doesn't know the South African-born American entrepreneur and businessman Elon Musk. You'll best recognize him as the co-founder of PayPal, and Tesla Motors, or as the man who created the company SpaceX, so some of us, one day, might reach that elusive goal of colonizing the Red Planet. We all know Elon Musk, but what does the man who became a multimillionaire in his mid-20s have to say about Bitcoin?

Elon Musk, the man who earned his first billion with the sale of PayPal in 2002, moved to Canada at age 17 to avoid mandatory military service in South Africa, to eventually find his way into Stanford University in California to pursue a PhD in energy physics.

However, after just two days he dropped out of Stanford to launch his first company, Zip2 Corporation, which he sold in 1999 for $307 million in cash and $34 million in stock options to a division of Compaq Computer Corporation.

Later that same year, Musk co-founded X.com, an online financial services and payments company, which led to the creation of PayPal as it is known today.

Three short years later, in 2002, PayPal was acquired by eBay for $1.5 billion in stock, making Musk an overnight billionaire.

The tech-savy billionaire went on to found his third company, Space Exploration Technologies Corporation, or SpaceX, in 2002 with the intention of building spacecrafts for commercial space travel, followed by the creation of Tesla Motors in the next year. The rest is, as they say, history.

Read more: Is Bitcoin at $1 million really possible?

Bitcoin will be used for illegal transactions

During an interview at Vanity Fair's New Establishment Summit in late 2014, Musk was asked by host Walter Isaacson, if he thought Bitcoin could have the potential to be disruptive to the banking industry.

'I think Bitcoin is probably a good thing', he said, 'I think it’s primarily gonna be a means of doing illegal transactions.'

'But that's not necessarily entirely bad. You know, some things maybe shouldn't be illegal.'

Musk, said that he sees Bitcoin as a necessary bridge between legal and illegal transaction.

'It will be useful for legal and illegal transactions. Otherwise it would have no value as a use for illegal transactions. Because you have to have a legal to illegal bridge', he concluded the topic.

The different social media communities at the time were quit disappointed with the remarks of Musk, who downplayed the legitimacy of Bitcoin, and instead focused on illegal incidents involving the world's most popular digital currency.

Read more: What does Bill Gates have to say about Bitcoin?

Elon Musk denies he is Bitcoin's mysterious inventor

In 2017, the Tesla boss responded to a post by a software engineer at SpaceX, Sahil Gupta, who floated the idea that Elon Musk must have been the creator of Bitcoin. Gupta based his assumptions on Musk’s history of innovative endeavors across multiple tech disciplines, his extensive understanding of economics and cryptography and of course his substantial coding abilities.

'If Elon Musk is indeed Satoshi Nakamoto, it seems like this knowledge would become public at some point anyway. But if it were public now, Elon could offer guidance as the currency’s founding father', Gupta said.

However, the tech entrepreneur behind Tesla and SpaceX was quick to deny it himself in a short, but direct tweet.

Of course, some argued that denying to be Satoshi Nakamoto, is exactly the sort of thing the person behind the pseudonym would do when they were to be confronted with this claim.

We can all agree that Musk is a lot of things, but the inventor of Bitcoin? Nope, most likely not.

Read more: 8 long-term Bitcoin price predictions by experts

Wanna buy some Bitcoin?

In October 2018, Musk lightheartedly responded to a serious question regarding whether Tesla accounts would begin utilizing 2-factor authentication.

'Wanna buy some bitcoin?', he replied, sending along an anime image which is wearing a Bitcoin logo dress.

Most likely, Musk saw it as an opportunity to make a joke regarding cryptocurrency, knowing that many, if not all, cryptocurrency exchanges such as Coinbase, and Binance, utilize 2-factor authentication for security reasons.

Musk’s tweet immediately went viral, attracting over 8,000 likes and over 3,000 retweets within hours of being posted. Many cryptocurrency enthusiasts wondered whether Tesla would start accepting cryptocurrencies in the nearby future.

The CEO of Binance, Changpeng Zha, was one of the many prominent figures in the cryptocurrency community that responded to Musk's tweet.

'Lol, it’s spreading', he said. 'I will buy a Tesla if you accept crypto…'

To no surprise, it didn't take long before Twitter locked his account over concerns that Musk's account had been compromised.

In a recent interview with ARK Invest's FYI podcast, Musk explained that at the time, Bitcoin and Ethereum scammers were so rampant on Twitter that he decided to join in and said at one point 'wanna buy some bitcoin?'

'Then I got my account suspended, cause obviously there was like some automatic rule that if you try to sell Bitcoin or something and I was just joking.'

Read more: 9 Bitcoin price predictions for 2020 by crypto experts

'Crypto a better way to transfer value, without a doubt'

In that same interview, the CEO, and product architect of Tesla, went on to say that crypto is a far better way to transfer value than pieces of paper.

'That's for sure. Without a doubt', he said.

However, when the host of the podcast asks Musk, given his impressive history in the payment ecosystem, if he agrees with Twitter CEO Jack Dorsey, that there will be one native coin for the internet, being Bitcoin, Musk responds by saying that he thinks the Bitcoin structure was quite brilliant.

'But I am not sure if it would be a good use of Tesla resources to get into crypto.' he adds.

'We are trying to focus on Tesla and I think actually one of the downsides of crypto is that computationally, is that it's quite energy intensive. So there have to be some kind of constraints on the creation of crypto. It is very energy intensive to create an incremental bitcoin at this point.'

Read more: Could Jack Dorsey be right? Will we ever see BTC as a native internet currency?

Although the narrative that crypto mining is extremely energy intensive and is drastically damaging the environment is well known amongst the common public, recent research on the environmental impact of Bitcoin, shows that Bitcoin mining is not as bad for the environment as previously thought.

Researchers from the Digital asset firm CoinShares took a closer look at crypto miners and said that in their view, cryptocurrency mining, while expensive, is doing little meaningful harm as far as the environment is concerned, and is also unlikely to do so in the foreseeable future.

Within this study they found that over 75% of those who mine crypto, use renewable energy. They also point out that Bitcoin mining facilities in China, which mines up to 70% of all Bitcoin, are mostly in areas with a cooler overall climate, therefore needing less power to keep the mining rigs cool.

'We keep stressing these facts because the common public narrative surrounding the environmental impact of cryptocurrency mining is overwhelmingly negative.'

It is as well advisable to keep in mind that the power consumed by mining Bitcoin looks almost insignificant compared to other commodities such as banking or mining gold.

Perhaps we can find a way to relay this research data to Elon Musk?

Read more: Researchers argue that Bitcoin mining is not damaging to the environment

Musk doesn't own any crypto, except 0.25 BTC a friend gave him

Just one day after his interview on the ARK Invest podcast in which Musk said the Bitcoin structure is 'quite brilliant', he revealed he only owns a small amount of cryptocurrency. 

Musk already revealed in the beginning of 2018 that he only owns 0.25 BTC which was sent to him by a friend years ago.

In response to the 'sad' fact that Musk owns only 0.25 BTC, many cryptocurrency legends came forward offering Musk 'some more Bitcoin'.

Anthony Pompliano, crypto personality and founder at Morgan Creek, urged Elon Musk to send him a Lightning Network invoice or a Bitcoin wallet address so that he could send Musk some more Bitcoin.

'We have to get you using the future global reserve currency of the world', Pomp said.

Read more: 6 Bitcoin conspiracy theories: did the CIA create BTC, or 4 tech giants?

There you have it. A few of the highlights of Elon Musk in regards to the number one cryptocurrency.

We can clearly see that Musk musk has something going on in his mind regarding Bitcoin, we just can't see yet what that is.

One things is obvious: Musk respects the blockchain technology, and we can almost assume that he is positive about Bitcoin, even though he never actually endorsed it.

Nevertheless, the day that Elon Musk will publicly support cryptocurrencies, might be closer than we think and a support signal from Musk, is only going to boost Bitcoin to the moon ... or will it be Mars?

WATCH: Elon Musk thinks Bitcoin is better than fiat! Why doesn't he buy more?!


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