It is difficult to judge whether Musk’s statement will have any impact on the broader understanding of encrypted digital currencies, or what role his views will play in the next stage of encrypted digital currency adoption.
Editor’s note: This article is from Tencent Technology, compiled and compiled.
On May 17th, when “Silicon Valley Iron Man” Elon Musk (Elon Musk) disclosed that Tesla had bought $1.5 billion worth of bitcoins three months ago, the support of encrypted digital currency The author claims that this move will accelerate the speed at which encrypted digital currency is widely used as a corporate financial tool.
However, on Wednesday, Musk withdrew his personal support, vowing to no longer accept Bitcoin as a payment method for Tesla’s electric vehicles, and weakened the company’s justification for using it as a method of storing idle cash. As usual, Musk’s comments provided direct fuel for cryptocurrency traders and also triggered a war of words on Twitter between supporters and opponents. But what is more difficult to judge is whether Musk’s statement will have any impact on the broader understanding of encrypted digital currency, or what role his views will play in the next stage of encrypted digital currency adoption.
“He always speaks every two days, and it’s inconsistent,” said John Coffee, a professor at Columbia Law School. He said that Tesla claims to push Bitcoin into the mainstream of corporate use, but this always sounds second to its interest in pure financial speculation. “I think Musk’s first investment in Bitcoin was more of a currency investment than anything else.”
No matter what is hidden behind Musk’s intermittent love of Bitcoin, his influence on market prices is hard to ignore. On the day Tesla disclosed its investment in Bitcoin, the value of this encrypted digital currency rose by 15%. Within 24 hours of announcing that it would no longer accept Bitcoin as a payment method for Tesla’s electric cars last week, the value of Bitcoin dropped by 6%.
Just a few days before Bitcoin fell, Musk jokingly condemned another cryptocurrency, Dogecoin, which he promoted vigorously, as a “scam” in a TV interview, causing its value to fall by 15%. “There is no doubt that in terms of price changes, Musk has become the most important factor for encrypted digital currencies,” said JP Thieriot, CEO of blockchain company Uphold. “Musk’s influence also extends to shaping people’s perceptions of encrypted digital currencies,” he said.
However, even Musk cannot force encrypted digital currency into mainstream commercial use. He said last week that Tesla has given up accepting Bitcoin payments because the energy-intensive “mining” of verified transactions has an environmental impact-a well-known problem that he has ignored in the past.
Many cryptocurrency experts said that Musk’s change of heart seems to reflect an acceptance that Bitcoin is not suitable for payment. Accepted Bitcoin in the past asOther payment methods companies, including Dell and Microsoft, later also abandoned Bitcoin. Wilson Withiam, an analyst at Messari, an encrypted digital currency research organization, said: “I don’t think many people are willing to spend their bitcoins. If there is real financial support behind it, Tesla will really do so. Right?”
Musk’s change of heart is not limited to payment issues. He also vowed not to let Tesla become an active participant in the Bitcoin market. On Sunday, Musk hinted that Tesla may sell or have sold the bitcoin held in his Twitter interaction with fans.
Two weeks ago, Tesla disclosed in its financial report that the company unexpectedly made a profit of $101 million through the sale of some bitcoins. This move has triggered people to increase the company’s performance with encrypted numbers. Concerns about currency trading links. The previous promise to no longer sell bitcoin may reassure some investors, but it also effectively undermines Tesla’s reason for using bitcoin as part of its daily corporate financial operations.
Tesla’s Chief Financial Officer Zach Kirkhorn told Wall Street analysts in two weeks that the liquidity of the Bitcoin market justified Tesla’s holding of encrypted digital currencies because of this It means that the company can actively buy and sell. He said that this flexibility is particularly important because Tesla faces greater cash needs and needs to fund Texas and German factories, while also dealing with extreme financial pressures in the supply chain caused by global semiconductor shortages. “It is very important for us to be able to get cash very quickly,” Kirkhorn said. Musk promised to lock up the company’s Bitcoin investment in a tweet, destroying this idea.
Some Bitcoin supporters say that Musk is still encouraging other companies to treat Bitcoin as valid holdings, paving the way for corporate finance staff to adopt Bitcoin more widely–although few other companies have announced the purchase of Bitcoin Examples of coins. Rayne Steinberg, CEO of digital asset management group Arca, stated that his initial passion for Bitcoin sparked interest-including corporate finance personnel. People are talking about it, it has entered the spirit of the times.
However, some corporate finance experts say that the flirtation between Tesla and encrypted digital currencies does not help encourage wider adoption. Jerry Klein, a partner at Treasury Partners, a financial firm in New York, said: “This has triggered a conversation among financial staff, but I don’t think it has changed anyone’s mind.”. Klein added that for financial personnel, the primary requirement to protect the company’s cash value has completely excluded encrypted digital currencies. But if Musk’s involvement in Bitcoin fails to change the currency’s position in the corporate world, his recent intervention has brought another prospect: He may become the king of encrypted digital currencies in the future and compete with Bitcoin.Even replace Bitcoin.
Supporters say that Musk uses his celebrity effect to attract people’s attention to the huge energy consumption of Bitcoin, which may accelerate the search for alternatives. “Millennials and Gen Z are big buyers of encrypted digital currencies. Surveys of them show that they are also deeply concerned about climate change,” Tirion said.
Musk’s remarks immediately attracted the attention of supporters of encrypted digital currencies. They claim that encrypted digital currency has less negative impact on the environment. However, most of the newer networks are struggling to win attention and share of encrypted digital currency investment. Most of the diverted attention is on Ethernet. Ether is a token used on the Ethereum network with a total market capitalization of US$440 billion, which is almost half of Bitcoin.
When Musk stayed away from Bitcoin, he did not immediately indicate which encrypted digital currency would win his favor, but he hinted at it. He said on Twitter last Thursday: “Cooperate with Dogecoin developers to improve system transaction efficiency. There is potential.”
He stated that Tesla hopes to use a digital currency that consumes less than 1% of Bitcoin. This comment will surely make crypto-digital investors guess-and make sure that everyone is staring at his tweets. Look for the next clue of his thinking.