Tesla stops accepting bitcoin – advantage Elon Musk & Dogecoin?

Karthik Subramanian

Elon Musk, the owner of Tesla, the world’s largest producer of electric cars, today declared that Tesla would no longer accept bitcoins as a payment method for its cars.

blockchain

Elon tweeted that the company was worried about the energy being used up for bitcoin mining and how fossil fuels are destroying the Earth and hence the company had decided to not use Bitcoin as a payment method henceforth. It was only a couple of months back that he had said that Tesla had started accepting bitcoins as a payment method.

In what can be seen as proof of how fickle the cryptocurrency market can be and how risky it can be for traders, the value of bitcoin plunged by closed to 20% from $57,000 to close to $46,000 before recovering back to $50,000 again.

Though on the face of it, the declaration by Elon Musk seems to show concern for the environment, skeptics still believe that it is more of a price manipulation tactic rather than a real concern. The fact that Bitcoin uses a lot of energy for its mining and the fact that most of the available bitcoins have already been mined is well known in cryptocurrency circles.

So to declare that as something that they have newly identified and realised has sowed doubts in the minds of the sceptics. The unfortunate effect of all this is that the retail traders have been left in the lurch and a lot of liquidations have happened on leveraged positions in many of the crypto exchanges overnight.

Elon also tweeted that Tesla would be looking to accept other cryptocurrencies, that consume very little energy, as means of payment in the future which could be interpreted as a nudge towards dogecoin, his favorite crypto at the moment.

The prices of bitcoin have since crashed and this shows that it continues to be a market that can be manipulated by big players and we are far from having a level playing field in the crypto market as yet. While the entry of very large and credible investors like Elon Musk is indeed a boost to the market as a whole, such price manipulation through tweets serves to reduce the credibility of the market as a whole and tends to put off serious investors who are looking for stable instruments to trade with low risk.

This has also led to renewed calls for regulation to bring such activities under control and it also calls for diversification of trades and investments into other cryptocurrencies so that the manipulation in one instrument does not affect the entire market as a whole.

Read this next

Digital Assets

Binance US weighs plans to go public, CEO CZ says

Binance.US, the American outpost of the world’s biggest crypto exchange, has seemingly plans to follow Coinbase’s path and go public one day.

Retail FX

FX volumes, number of active clients boom at Exness in June 2021

The latest group of retail FX platforms to report their monthly volumes indicate that June was a busier month all round, with Exness setting its second-highest monthly volumes on record.

Industry News

Individuals impersonating CySEC representatives draw warning from Cyprus watchdog

The Cyprus financial watchdog said on Friday there was evidence of fraudulent impersonation of its officials who are engaged with firms under CySEC’s supervision.

Digital Assets, Inside View

SEC v. Ripple angers XRP holders as rival Stellar (XLM) mixed in “love triangle” over MoneyGram

“Although the SEC claims that all XRP are unregistered securities and Brad Garlinghouse and Chris Larsen unjustly enriched themselves, it allows Ripple Co-founder JedMcCaleb to sell his XRP for hundreds of millions of dollars to possibly buy MoneyGram. Makes perfect sense”, said XRP Holders’ attorney John Denton ironically.

Industry News

Monex loses second appeal in CFTC anti-fraud enforcement action

Since Dodd-Frank that such trading must be conducted on a regulated exchange, and that the offeror must be registered with the CFTC.

Technology

Profile Software announces automated custody platform and mobile tech

The upgraded version of Axia Custody offers advanced functionality for multi-custodian operations across borders for a competitive multi-channel international-level client experience.

Industry News, Institutional FX

IHS Markit to pay CME Group $113m amid EU approval of post-trade JV

IHS Markik, at the same time, is being acquired by S&P Global Inc for $44 billion in stock, subject to approval as well.

Digital Assets

India’s Central Bank working towards implemention of digital currency

The Deputy Governor of the Reserve Bank of India, T Rabi Sankar, has said that the central bank was working towards a phased implementation of a central bank digital currency and is in the process of introducing it for wholesale and retail segments shortly.

Industry News

Visa acquires Currencycloud to facilitate global funds movement

Visa has announced the acquisition of Currencycloud, which provides APIs which help institutions with remittance and currency exchange capabilities in a deal that is valued at $963 million.