Billionaire entrepreneur and Tesla CEO Elon Musk touted Bitcoin’s ability to protect investors from fiat money printing, which may increase due to what analysts call a forthcoming government-funded race to develop artificial intelligence.
Musk has praised Bitcoin’s (BTC) energy-based proof-of-work model for its inflation-proof mechanism, which is immune to governmental fiat currency printing as it is “impossible to fake energy.”
“That is why Bitcoin is based on energy: you can issue fake fiat currency, and every government in history has done so, but it is impossible to fake energy,” Musk wrote in a Tuesday X post.
Musk’s comment came in response to popular analyst Zerohedge’s post, which attributed the current momentum behind Bitcoin and precious metals to a “debasement” to fund the government-funded AI arms race that will play out between the world’s largest economies.
Source: Elon Musk“AI is the new global arms race, and capex will eventually be funded by governments (US and China),” Zerohedge wrote in a Tuesday X post, attributing the recent momentum of Bitcoin, gold and silver to the “debasement to fund the AI arms race.”
Related: $19B crypto market crash was ‘controlled deleveraging,’ not cascade: Analyst
Musk predicted Bitcoin’s “long winter” after FTX collapse
Tuesday’s response marked Musk’s first serious Bitcoin-related public post in nearly three years, since November 2022, when he predicted the incoming crypto winter shortly after the collapse of FTX and Alameda Exchange.
“BTC will make it, but might be a long winter,” wrote Musk in an X post on Nov. 14, 2022, in response to Bitcoin hitting the previous bear market’s lowest point of $16,000.
Source: Elon MuskFTX collapsed due to the misappropriation of user funds, resulting in an $8.9 billion loss of investor funds. The crypto exchange filed for bankruptcy on Nov. 11, 2022, and was seen as the main catalyst behind the subsequent crypto winter.
Related: DeFi booming as $11B Bitcoin whale stirs ‘Uptober’ hopes: Finance Redefined
Musk has yet to comment on the sustainability of the Bitcoin mining network, which he previously criticized for its over-reliance on fossil fuels.
In May 2021, electric car manufacturer Tesla suspended Bitcoin payments for vehicle purchases, citing environmental concerns, which caused Bitcoin’s price to drop by 6% within an hour, from $54,800 to roughly $51,600.
Source: Elon MuskWhile Tesla hasn’t sold the majority of its Bitcoin holdings, the company has yet to comment on potentially reinstating Bitcoin payments, as Musk previously pledged to do if the mining network’s use of renewable energy increased.
On June 13, 2021, Musk said Tesla would allow BTC transactions once it could confirm that the Bitcoin mining network uses at least 50% clean energy.
Source: Woocharts/CointelegraphBitcoin mining’s sustainable energy usage reached an all-time high of over 55%, according to the above graph modeled by climate tech venture capitalist Daniel Batten and Bitcoin analyst Willy Woo.
Cointelegraph has approached Tesla for comment.
Magazine: ‘Debasement trade’ will pump Bitcoin, Ethereum DATs will win: Hodler’s Digest, Oct. 5 – 11
Source: https://cointelegraph.com/news/elon-musk-bitcoin-fiat-ai-arms-race?utm_source=rss_feed&utm_medium=feed&utm_campaign=rss_partner_inbound
