Bitcoin surged beyond $39,000 after Elon Musk announced that Tesla Inc. will start bitcoin transactions after mining is done using cleaner energy.
Tesla’s CEO, Elon Musk, said in a tweet that the company will resume accepting Bitcoin transactions “when there’s confirmation of fair (50 percent) renewable energy consumption by miners with a favorable future trend.”
His remark was in response to a piece in Cointelegraph that quoted Magda Wierzycka, executive chair of South African asset management Sygnia, as suggesting that Musk’s recent statements on Bitcoin should have provoked an SEC inquiry.
On Sunday afternoon in New York, the cryptocurrency rose 9.3% to $39,372, the highest level since June 3 and just below the $40,000 round-number mark viewed as critical by some chart analysts. As of 7 a.m. in Hong Kong on Monday, it was down around 1% to $38,881.
In recent months, Musk has wreaked havoc on Bitcoin and other digital coins. Tesla said in February that it had purchased $1.5 billion in Bitcoin and that it would begin taking Bitcoin as a form of payment for automobiles.
“You can now buy a Tesla using Bitcoin,” Musk tweeted in March, only to announce in May that the practice had been halted owing to worries over the use of fossil fuels for Bitcoin mining and transactions.
“They committed to publish current & planned renewable usage & to ask miners WW to do so,” Musk said in late May, referring to the problem he had mentioned in his reason for Tesla to stop accepting Bitcoin as a payment method, saying, “They committed to publish current & planned renewable usage & to ask miners WW to do so. Potentially promising.”
However, since Musk declared that Tesla will no longer accept Bitcoin as a payment mechanism, crypto believers have stopped appreciating Musk’s tweets.
As Wierzycka’s reported comments reflect, the U-turn has been divisive, partly because Tesla and Musk’s actions have had a notable impact on Bitcoin’s price.
While there are other aspects to consider, such as institutional adoption and diversity on the good side, and sustainability and regulatory concerns on the negative side, a Musk tweet can often shift the narrative and dominate it for days or weeks.
Traders and investors have also expressed their dissatisfaction with Musk’s comments, which have a significant influence on cryptocurrency pricing.