Elon Musk has re-entered the debate on Bitcoin, linking its energy-intensive nature to the rising demands of artificial intelligence and asserting its value against “fake” government-issued currency.
The CEO of Tesla and SpaceX posted on X early this week, stating, “Bitcoin is based on energy: you can issue fake fiat currency, and every government in history has done so, but it is impossible to fake energy.” This remark underscored Bitcoin’s reliance on real energy consumption, a direct contrast to unlimited fiat money printing by governments.
Musk’s comment came in response to a post by financial media outlet ZeroHedge. The outlet had described the surge in artificial intelligence as a “global arms race” requiring vast energy resources, including potentially hundreds of new nuclear power plants in the U.S. by 2028.
ZeroHedge argued that governments would likely fund this massive expenditure by printing more currency, which would devalue money and push up prices for assets like gold, silver, and Bitcoin. The financial news source emphasized that “you can’t print energy.” Musk concurred, positioning Bitcoin as an asset backed by a scarce and verifiable resource.
This is not Musk’s first engagement with Bitcoin, but it marks his return to a public discussion of its fundamental value. In February 2021, Tesla announced a $1.5 billion purchase of Bitcoin and briefly accepted the cryptocurrency for vehicle payments.
However, in May 2021, Tesla suspended Bitcoin payments, citing environmental concerns over the high energy consumption of its proof-of-work mining model. In July 2022, during a cryptocurrency market downturn, Tesla sold 75% of its Bitcoin holdings for approximately $936 million, attributing the move to liquidity needs amid macroeconomic uncertainties.
Despite these past actions, Musk has consistently stated his support for “crypto in principle,” distinguishing between the technology’s merit and its environmental impact. Tesla currently retains approximately 11,509 BTC, valued at about $1.2 billion. Musk had previously conditioned the resumption of Bitcoin payments on the mining network achieving at least 50% clean energy.
The cryptocurrency community reacted enthusiastically to Musk’s latest comments, with many on X questioning if Tesla would reconsider accepting Bitcoin payments. Michael Saylor, CEO of MicroStrategy, echoed the sentiment by responding to Musk, stating that “the laws of nature are superior to the laws of man.”
Musk’s commentary arrives as global concerns mount over the escalating energy demands of AI and cloud computing. Projections indicate this demand will necessitate significant advancements in renewable energy, storage, and efficiency, as the rapid construction of large-scale nuclear plants remains an unrealistic short-term solution.
Bitcoin’s price did not immediately reflect a positive reaction to Musk’s statement. The cryptocurrency saw a 3.2% drop in price over 24 hours, falling below $111,000 USD, influenced largely by ongoing trade tensions between China and the U.S.
There are currently no indications that Tesla plans to resume Bitcoin payments. Nevertheless, Musk’s renewed engagement suggests his continued monitoring of both currency devaluation trends and the evolving role of digital currencies in a world facing increasing energy demands.