The Bitcoin markets are pulling back after electric car manufacturer Tesla suspended its support for vehicle purchases using BTC. In a May 13 tweet, Tesla’s CEO Elon Musk noted the company’s concerns regarding the “rapidly increasing use of fossil fuels for Bitcoin mining and transactions, especially coal.”
While Musk predicted that cryptocurrency “has a promising future,” he concluded that the rise of digital assets “cannot come at a great cot to the environment.
However, the firm has not ruled out accepting BTC again in future, with the post noting the firm will resume using Bitcoin “for transactions as soon as mining transitions to more sustainable energy."
The cryptocurrency market corrected sharply on May 12 after the hype surrounding dog-themed tokens was deflated when Ethereum co-founder Vitalik Buterin dumped vast amounts of the previously hot Shiba Inu (SHIB), Dogelon Mars (ELON) and Akita Inu (AKITA) on the market and donated the proceeds to charity.
Data from Cointelegraph Markets and TradingView shows that as meme tokens sold off, Bitcoin (BTC) price continued its recent weakness and declined nearly 8% decline to $53,500 before recovering to $54,700.
Ether (ETH) was less affected by the sell-off and actually managed to recover above $4,000 to reclaim its daily losses as users of the network applauded Buterin’s decision to donate his meme coins to various charities. Traders are also hopeful that the decreased trading activity in meme tokens will help push down gas fees on the Ethereum network.
With Tesla’s suspension of Bitcoin payments causing chaos in crypto markets today, critics have targeted CEO Elon Musk’s cavalier attitude to the dramatic effects his words and actions can have on the sector.
On May 13, Tesla and Musk announced that it had ceased accepting BTC as payment for vehicles due to concerns regarding the “rapidly increasing use of fossil fuels for Bitcoin mining and transactions, especially coal.”
In response to the news, Bitcoin shed 15% in less than three hours, plummeting from nearly $55,000 to $46,600. Bitcoin’s “Fear & Greed Index” has also swung aggressively from yesterday’s greedy score of 68 to a fearful score of just 31 today.
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