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Tesla’s chief executive officer Elon Musk has hinted that the electric car maker may accept Bitcoin (BTC/USD) again as payment for its products. Bitcoin reacted with a 13% pump within 24 hours of his announcement.
However, the executive said it will not be happening unless miners use about 50% of clean energy. The Cambridge Center for Alternative Finance recently revealed that about 39% of mining activities on cryptocurrencies use renewable energy sources.
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By this estimate, it means miners need to add about 11% in renewable energy mining before Tesla considers Bitcoin acceptance.
Following the jump, the crypto asset is now trading at $39,533, based on data from Coindesk while this is still a far cry from its all-time level two months ago, it’s an impressive surge knowing that it was trading at roughly $30,000 two weeks ago.
A massive influence on Bitcoin’s price
There is no doubt that Elon Musk has had a big influence on the price of Bitcoin in recent months. His previous tweets about the cryptocurrency coincided with an unprecedented upsurge leading Bitcoin to hit an all-time high of $64,800 in April.
Again, when he tweeted that Tesla has suspended Bitcoin acceptance due to environmental concerns, the cryptocurrency nosedived. However, China’s resolve to ban Bitcoin mining also hurt the crypto asset.
Elon Musk has always been a crypto enthusiast, and it’s only a matter of time before Tesla starts accepting Bitcoin again, after the suspension period.
Although Bitcoin started picking up about two weeks ago, a 13% gain within the space of 24 hours is likely attributed to Elon Musk’s recent tweet.
This is inaccurate. Tesla only sold ~10% of holdings to confirm BTC could be liquidated easily without moving market.
— Elon Musk (@elonmusk) June 13, 2021
When there’s confirmation of reasonable (~50%) clean energy usage by miners with positive future trend, Tesla will resume allowing Bitcoin transactions.
Mining Bitcoin using clean energy
Crypto mining consumes massive amounts of energy that powers computers to solve complex mathematical problems. It has been estimated that the energy consumption level of Bitcoin mining a year exceeds the entire yearly energy consumption of some countries.
There is more clamor for the use of renewable energy to mine Bitcoin than ever before, and stakeholders in the industry have already set up a commission that is tackling the issue. Chief Executive Officer of Microstrategy Michael Saylor, who is a staunch Bitcoin believer, is heading the commission.