Cryptocurrency prices rose after Tesla CEO Elon Musk said he had no incentive in seeing prices fall and he would hold his large personal stake in bitcoin, rival digital asset ethereum and meme coin doge.
“Three things I own outside of SpaceX and Tesla are Bitcoin, some Ethereum and some Doge. If the price of bitcoin goes down, I lose money. I might pump but I don’t dump,” Musk said Wednesday during a virtual panel discussion at The B Word conference on cryptocurrencies.
In an apparent reaction to Musk’s pronouncements, bitcoin recovered from its dip below $30,000, gaining 6.4 percent to reach $31,696.39, while Ethereum spiked 8.8 percent to $1,941.61, after briefly jumping above the $2,000 ceiling it has been hemmed under for weeks.
Dogecoin, on the other, hand, gained more than 9 percent to $0.18. Other digital coins such as XRP, cardano, uniswap also jumped in the range of 6-10 percent after Musk’s statement.
The Tesla CEO also said the electric car maker is likely to resume accepting bitcoin for payment in the future as efforts to tap more renewable energy sources to virtually mine the asset bear fruit.
In February, Tesla disclosed that it had invested $1.5 billion in Bitcoin. Musk said in March that Tesla would accept bitcoin as payment but he changed his mind about that in early May, after 49 days.
Tesla is the second-largest publicly traded corporate holder of Bitcoin after MicroStrategy, and some market observers say that the companies’ CEOs, Musk and Michael Saylor, are pumping the cryptocurrency and manipulating its price to avoid going underwater and being forced to sell.
Musk is known for trying to rescue-pump Bitcoin and other cryptocurrencies in his portfolio using tweets and memes including the diamond hands emoji, which investors use to make it clear that they are holding an asset and not selling.
In the B World Conference panel discussion, Musk noted that Bitcoin’s downsides need to be ironed out. He singled out the proof-of-work aspect and the high energy expenditure tied to crypto mining.
The energy use is “a bit too much and not necessarily good for the environment,” Musk said.
Environmental advocates have long decried Bitcoin’s growing popularity and were especially noisy about it in the days leading to Earth Day this year over its intense electricity consumption.
Listen to GHOGH with Jamarlin Martin | Episode 74: Jamarlin Martin Jamarlin returns for a new season of the GHOGH podcast to discuss Bitcoin, bubbles, and Biden. He talks about the risk factors for Bitcoin as an investment asset including origin risk, speculative market structure, regulatory, and environment. Are broader financial markets in a massive speculative bubble?