Bitcoin Plummets After Elon Musk Stops Taking Crypto Payments For Tesla

Bitcoin tumbled some 15 percent on news that Elon Musk will no longer take the cryptocurrency for Tesla payments due to environmental concerns, CNBC and other news outlets reported.

The entire cryptocurrency market lost more than $365 billion after the Tesla CEO tweeted that the electric vehicle maker will no longer take bitcoin for car payments due to concern over fossil fuels.

“We are concerned about rapidly increasing use of fossil fuels for bitcoin mining and transactions, especially coal, which has the worst emissions of any fuel,” Musk tweeted at approximately 6 a.m. Singapore time on Thursday (May 13).

“Cryptocurrency is a good idea on many levels and we believe it has a promising future but this cannot come at great cost to the environment,” per the tweet.

Before Musk’s announcement, the cryptocurrency market had a valuation of $2.43 trillion, according to data from Coinmarketcap.com. Less than three hours after Musk’s announcement, that value dropped to approximately $2.06 trillion.

Bitcoin — the most traded cryptocurrency worldwide — dropped 12 percent at roughly 9:30 a.m. Singapore time. This is the first time bitcoin was valued below $50,000 since the April rally. Even with the drop, bitcoin is up more than 400 percent in the past 12 months, per CNBC and CoinDesk data.

Bitcoin is managed by a matrix of miners that use high-energy purpose-built computers to calculate the math for transactions. The process reportedly uses more energy than some countries.

Tesla announced in February that it bought $1.5 billion worth of bitcoin and would start accepting the coin for car purchases. Musk has been a cryptocurrency cheerleader of sorts, driving up the price of bitcoin and doge.

Other companies have jumped on the crypto bandwagon, either accepting the coin as payment or holding it on their balance sheets as an investment.