Elon Musk is a complicated figure in the crypto world. He’s been beloved and derided so much that he probably deserves his own Fear and Greed index tracking Musk sentiment. Today we go over Musk’s complicated relationship with crypto — so far.  Covered: Intro To Elon Musk Musk And Paypal History With Bitcoin Musk Adopts […] The post Elon Musk’s Complicated Relationship With Crypto appeared first on CryptosRus.

Elon Musk’s Complicated Relationship With Crypto

Elon Musk is a complicated figure in the crypto world. He’s been beloved and derided so much that he probably deserves his own Fear and Greed index tracking Musk sentiment. Today we go over Musk’s complicated relationship with crypto — so far. 

Covered:

  • Intro To Elon Musk
  • Musk And Paypal
  • History With Bitcoin
  • Musk Adopts Dogecoin
  • Musk’s Future With Cryptocurrency

Introduction

Elon Musk is one of the most significant crypto influencers globally. His presence and support for the crypto space are essential, primarily due to the fact that he is one of the wealthiest mainstream businessmen, currently being the richest man in the world. Furthermore, his background in technology grants him, and his words the most powerful influence over the crypto industry. However, his relationship with the crypto world has been complex and volatile over the years much like the crypto market itself. Let’s explore its major ups and downs starting from the very beginning.

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Elon Musk and PayPal

Elon Musk is the CEO of Space X, Tesla, Open IA, Neuralink, and The Boring Company. These highly innovative companies cover a wide array of industries from Aerospace, and neurotechnology to AI and infrastructure. But before all that, back in 1998, Musk co-founded PayPal which was one of the earliest and most successful online payment processing company in the world. It reached 325 million active users in 2020 and went on to revolutionize the way money transfers hands over the Internet. This legacy has made it inevitable for Musk to eventually get involved (reluctantly, at first) with cryptocurrency, because this technology has taken online payments a step ahead of PayPal.

Elon Musk’s History with Bitcoin

Musk’s history with Bitcoin goes back to March 2014 when he was asked by a documentary photographer called Noel, about his stance on cryptocurrencies. He replied enigmatically, “Well, now that Satoshi Nakamoto has been discovered, I guess, it is case closed”. Later that year in October 2014, Musk was asked about Bitcoin at Vanity Fair’s New Establishment Summit, he replied, “probably a good thing”. “It is primarily going to be a means of doing illegal transactions”. Musk’s skepticism was quite justified at that time since Bitcoin was retreating from its then-all-time high value of around $1,156. This decline continued for several years until its recovery in late 2017.

In Nov 2017, the Tesla CEO began to seriously pay attention to Bitcoin. He took to Twitter to dismiss the rumors that he was the inventor of Bitcoin, saying that “A friend sent me part of a BTC a few years, but I don’t know where it is”. In 2019, Musk started considering cryptocurrencies more seriously, both from a technological viewpoint, as well as a potential component of his business models. In a podcast with Tech investment company, ARK Invest, Musk described Bitcoin as, “quite brilliant”. He further added that “paper money is going away and crypto is a far better way to transfer value than pieces of paper, that’s for sure”

On Feb 8, 2020, Tesla announced that the company had bought 1.5 billion dollars in Bitcoin and has plans to accept the cryptocurrency as a payment for its products. After the announcement, Bitcoin reached its all-time high value of $58,000 on Feb 21, 2021. Its price gained more than 20% from its level before the announcement. However, Musk’s Bitcoin story took a massive Uturn in May 2021 when he tweeted that Tesla would no longer be accepting Bitcoin as a payment method due to concerns about its energy consumption. He said, “When there’s confirmation of reasonable (~50%) clean energy usage by miners with positive future trend, Tesla will resume allowing Bitcoin transactions”. His tweet sent Bitcoin down close to $43,000.

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Dogecoin

Elon Musk announced in Jan 2022, that Tesla will accept Dogecoin as payment for his brand merchandise. We know up till now that Musk often tweets about different cryptocurrencies and his tweets have seemingly impacted their prices. However, his most famous role is in the meteoric rise of the first meme coin, Dogecoin. It is a meme-inspired cryptocurrency that began as a joke in 2013. Elon Musk mentioned Dogecoin for the first time on April 2, 2019. He tweeted, “Dogecoin might be my favorite cryptocurrency. it’s pretty cool”. As a result, the price of the coin went from $0.002 on April 1 to as high as $0.004 on April 4. His tweets about DOGE resumed in December 2022 and continue to this day. A single word “Doge” he tweeted on Feb 4, 2020, was followed by a price increase of about 120% over four days. Elon Musk became popular within the Doge community with 4000 plus members picking him as their CEO choice over Vitalik Buterin.

Musk showed interest in Dogecoin after hearing it from his employees. “Lots of people I talk to on the production line at Tesla or building rockets at SpaceX, own Doge. They aren’t financial experts or Silicon Valley technologists. That’s why I decided to support Doge- it felt like the people’s crypto”. He has even joked about Dogecoin potentially becoming the future reserve currency. “The point is that Dogecoin was invented as a joke, essentially to make fun of cryptocurrency. Fate loves irony. What would be the most ironic outcome? The currency that started as a joke in fact becomes the real currency. To the moon!”

The Future of Elon Musk and Crypto

Elon Musk has openly stated that his crypto holdings include Bitcoin, Ethereum, and Dogecoin. He tweeted, “Out of curiosity, I acquired some ASCII hash strings called Bitcoin, Ethereum, and Doge. That’s it!”. In Feb 2019 podcast with ARK Invest, Musk also added about Ethereum that “There’s some Merit to Ethereum”

On the other hand, he also warns people to be cautious with their crypto investments. He advised people to stop relying upon cryptocurrency exchanges and take ownership of their wallet keys. He also said that people should desist from investing heavily in cryptocurrency and focus on building products and services. However, Musk himself is holding crypto as far as one can see. He tweeted, “I still own and won’t sell my Bitcoin, Ethereum, or Doge FWIW (for what it’s worth)”. So the future of the relationship between Elon Musk and the crypto space remains a mystery.

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