Bitcoin Surges Near $40,000 on Favorable Elon Musk Comments. The seemingly perpetual volatile ride of Bitcoin just got roiled again when a titan of industry recently came out with some positive statements about the world’s most established cryptocurrency brand.
It neared a $40,000 valuation when Elon Musk reversed course and said he would again consider accepting the electronic financial instrument as payment for Tesla automobiles on one condition – that Bitcoin finds a way to reduce its carbon footprint by about 50%.
Cryptocurrency Contributes to Climate Change
The knock on cryptocurrency is that it is the most energy-intensive mode of creating a form of money. It is made by high-powered computers that compete against each other in the process of solving highly complicated mathematical puzzles. All this machinery is powered by fossil fuels – mostly coal, the dirtiest of fossil fuels.
The recent love affair between Elon Musk and a new cryptocurrency, Dogecoin, opened him up to criticism from environmentalists. They rightfully point out that Musk’s backing of Dogecoin could result in wiping out all the gains in carbon reduction his electric cars engender by not using fossil fuels.
Elon Musk was apparently stung by these comments and so announced he would no longer accept Bitcoin as payment for a Tesla. The result was significant downward pressure on the currency’s value. Now that he appears to be opening the door to original cryptocurrency again, its price recently reached $39,400.
Can Cryptocurrency Go Green?
A closer look at the situation reveals the devil is in the details, however. For example, how can any cryptocurrency reduce the enormous energy demand required to mine the product and maintain the massive computer banks that must store it all forever?
Solving this problem represents a considerable technical challenge. Certainly, crypto-servers could find a way to buy their energy from solar and wind providers. They could also purchase carbon offset credits and/or “plant a tree” for based on every percentage of units created. This would still be a long way from solving the problem, however.