The price of Bitcoin (BTC) and Ethereum (ETH) bounced back strongly after Elon Musk revealed that both Tesla and SpaceX own Bitcoin
Musk also revealed that the only publicly traded stock he owns is Tesla, and that he personally holds Bitcoin, Dogecoin (DOGE) and Ethereum.
“The only significant thing I own outside of Tesla is SpaceX,” he said at “The B Word” conference on Wednesday. Ark Invest CEO Cathie Wood and Twitter CEO Jack Dorsey were also present at the conference.
“Outside of Tesla and SpaceX stock, [Bitcoin] is my largest holding,” said Musk, who is the second richest person in the world with a net worth of $180 billion, according to Bloomberg.
The billionaire added that he is long on Bitcoin fundamentally and he supports cryptocurrencies long-term.
“If the price of Bitcoin goes down, I lose money. I might pump, but I don’t dump.” Musk said. “I definitely do not believe in getting the price high and selling or anything like that. I would like to see Bitcoin succeed.”
Musk did not disclose the exact amount of his personal investment or SpaceX’s holding in the crypto leader. However, he did hint that his rocket technology firm could dive further into Bitcoin. Earlier this year, he stated that Tesla added $1.5 billion worth of Bitcoin to its balance sheet.
Proof of Work (PoW) is the biggest concern
The energy demands surrounding proof-of-work mining is the biggest concern for Bitcoin, Ethereum and numerous other cryptocurrencies, Musk says.
The PoW mining process requires a lot of energy and computing power to solve complex mathematical puzzles for transaction validation. For that, miners need a lot of power and electricity, and Musk says most of that energy is derived from non renewable power sources.
“One thing you do need to watch out for with crypto, especially Bitcoin, is using proof of work, using energy that’s a bit too much and not necessarily good for the environment,” he says.
Meanwhile, Ethereum is planning to shift its transaction validation process to a proof-of-stake system after the launch of the long-anticipated Ethereum 2.0 next year. The proof-of-stake process doesn’t require significant energy since investors need to lock up money in a network for transaction validation.
Musk says Tesla will resume accepting Bitcoin once its mining shifts to clean energy.
“I wanted a little bit more due diligence to confirm that the percentage of renewable energy usage is most likely at or above 50%, and that there is a trend towards increasing that number, and if so Tesla would resume accepting bitcoin,” Musk said.
A joke brought Musk, Jack Dorsey, and Cathie Wood together
Hosted by the Crypto Council for Innovation, the “The B Word” conference started with a joke. Last month, in response to Dorsey’s tweets about the event, Musk referred to the event name as “bicurious.” Later on, both agreed to share the stage at the “The B Word” conference and engage in a conversation about Bitcoin.
Dorsey is one of the largest advocates of Bitcoin. Last week, he announced that his mobile payment company is set to launch a “DeFi” platform for developers to create projects based on Bitcoin.
Currently, most of the DeFi platforms are backed by Ethereum due to its smart contract capabilities. This announcement came after Dorsey confirmed that Square is working on a Bitcoin hardware wallet.
“I don’t think there is anything more important in my lifetime to work on,” Dorsey said at the Bitcoin 2021 Conference. “In fact, if I were not at Square or Twitter, I would be working on Bitcoin. If Bitcoin needed more help than Square or Twitter, I would leave them for Bitcoin.”
Besides Dorsey’s love for the world’s largest cryptocoin, his firm has generated billions of dollars in revenue from crypto services. In the first quarter of 2021, the San Francisco-based company generated $3.51 billion in Bitcoin revenue.
Wood also believes strongly in the future prospects of Bitcoin.
The $52 billion AUM fund manager shared earlier this year that the virtual currency would be “impossible to shut down” and added that regulators “will be a little more friendly over time” toward cryptocurrency.
Cathie Wood’s investment firm held a big stake in Coinbase Global and Grayscale Bitcoin Trust. In a partnership with 21Shares, Wood’s Ark Invest is also creating a bitcoin exchange-traded fund under the ticker symbol “ARKB.”
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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Author: Portfolio Insider