Bitcoin surged above $39,000 after Elon Musk announced that Tesla Inc. would start bitcoin transactions after mining is done using cleaner energy. Tesla’s chief executive officer, Elon Musk, stated in a tweet that the company would enable Bitcoin transactions again when there’s confirmation of appropriate clean energy usage by miners with a favourable future trend. In recent months, Musk has whipsawed Bitcoin and other digital assets. Tesla said in February that it had purchased $1.5 billion in Bitcoin and that it would begin taking Bitcoin as payment for vehicles.
El Salvador, a small country in Central America, too made a massive change due to its currency flow. In the past recent week, El Salvador’s president initiated to bring in Bitcoin as a form of legal tender for the citizens. This allowed in to bring a lot of environmental redirections to the country. The move also boosted the growth of bitcoin minimally. According to President Nayib Bukele, the goal is to address the issue that few individuals have bank accounts and to reduce the cost of sending remittances or money sent back to El Salvador by employees from other countries.
The path to the change:
- In February, Tesla announced it had bought $1.5 billion in Bitcoin and signalled its intent to accept Bitcoin as payment for vehicles.
- Bitcoin is found to have drastic effects on the environment.
- With rising pressure from environmentalists, Tesla took charge.
- In late May 2021, Tesla announces that it will suspend the use of bitcoin.
- Elon also hinted that Tesla may sell off all or majority of Bitcoin it purchased.
- Due to the announcement, Bitcoin price crashed by 50% to $30,000 on June 8, 2021.
- On June 9, 2021, El Salvador engages in using natural energy to mine cryptocurrency.
- Bitcoin surged above $39,000 after Elon Musk announced that Tesla Inc. would resume cryptocurrency transactions once mining can be performed with much more environmentally friendly energy.
- Bitcoin rose as much as 9.3%, currently trading in at $40,230 on June 14, 2021.
Being eco-friendly and affordable
El Salvador, which has used the US dollar as its official currency for more than 20 years, became the first country in the world to pass legislation allowing the use of Bitcoin in any transaction last week. According to President Nayib Bukele, the goal is to address how few citizens have bank accounts and reduce the cost of sending remittances or money sent back to El Salvador by workers from other countries.
Even though Elon Musk’s tweets way the nature of the currency, its approach to the environmental factor could boost the currency’s dignity.
The Question
Despite all this, creating natural energy for mining and shelling millions of dollars to destabilize an economy, how far can El Salvador’s people go into using bitcoin? Considering the nation’s per capita income, will it sustain at the mere value of the currency and the patience of the people that lie at the hands of influencers like Musk, who uses his social media power to throttle the value?
