Elon Musk’s End Game With Bitcoin

Everyone in the crypto ecosystem is well aware of Elon Musk’s tantrum by first adopting Bitcoin for Tesla, putting it on the balance sheet, then selling a little part to apparently check the “liquidity”, or removing the Bitcoin as a payment method citing Bitcoin’s energy issues.

Well, it might sound all crazy and confusing. But here’s a thing – we came across a peculiar thread on Twitter by @CroissantEth who digs deeper into Musk’s actions and finds out his “end game”. So here it goes.

The U-Turn

The given user put forth an argument – why would Elon Musk blatantly speak negatively about Bitcoin merely a few weeks after his company invested over $1 Billion in it. Also, in an earlier tweet, Musk admits Tesla owning and operating their own Bitcoin nodes, contradicting their claims of environmental concerns. Unless, Tesla is running the nodes powered by green energy such as solar energy. So what were his reasons? 

Tesla & Ark Investments

Well, there comes Ark Investments in the picture. Ark Investment is a top shareholder of Tesla and recently published an article demonstrating research on Solar Battery $BTC mining. The research seems to hint at a $BTC use case for Tesla regarding energy provision & efficiency and the results are very promising. Ark Investments argues that $BTC mining can increase the overall share of a grid, & generate more electricity from renewable carbon-free resources.

So, where does Tesla play into this at all? Well, there comes Carbon Credits in the picture. 

Carbon Credits

Many are unaware of this fact, but over 13 states in the US require auto manufacturers to sell a minimum amount of zero emission vehicles to be allowed to sell any vehicles in their state. Companies who do sell zero emission vehicles like Tesla get “environmental credits” which can then be sold to other car manufacturers who don’t yet have zero emission vehicles for sale.

tesla revenue

Just in the year of 2020, these credits made up 7% of Tesla’s total revenue ($428M). While this is great in practice, the profitability is expected to decline in the future due to companies creating their own carbon-free alternatives to bypass this. This is additionally confirmed by Tesla CFO Zach Kirkhorn in talks about Tesla’s earnings. 

Considering the fact that this significant portion of revenue will be taken away from the company, is it possible that Tesla may seek $BTC as a solution to promote renewable energy and monetize it? 

Well, it does make sense because it is often being said that Tesla is more than just an electric car company. Tesla’s main business is in producing solar panels, solar roofs, and batteries. Oftentimes Tesla powerwalls run into excess energy, which could hypothetically be re-routed to mine $BTC. This way, Tesla could turn excess power into a digital asset instantly bankable.

To give more cushion to this fact, recently, the core Tesla team members discussed their Virtual Power Plant model in an interview making it quite clear what is going on at Tesla with their auto bidder platform. 

Therefore, the user @croissantEth claims that Tesla may soon announce a renewable way of mining $BTC by using excess energy generated by powerwalls, one which can be used by anyone with Tesla roofs, panels, cars, & more! And the last key to the puzzle is – Starlink. 

Starlink

Starlink is a massive project backed by Elon Musk and his company, SpaceX. By launching a staggering 47,000 satellites into space, starlink will offer internet access worldwide, where many aren’t already capable of today. With it, the internet will be changed forever. So when it comes to the possibility of Tesla Powerwalls mining cryptocurrency with excess energy, you need to ensure nodes don’t have downtime, and what’s a better way to do so than having universal satellite internet access for powerwalls? Starlink it is.

The End Game

CroissantEth also argues that since Elon Musk is betting big for colonizing Mars and making humanity a multi-planetary species – there’s a good reason that the currency of Mars will be Bitcoin. That is the Bitcoin end-game.

Well, let’s summarize then:

  • – Tesla invests $1.5B into $BTC
  • – Elon says $TESLA will accept $BTC
  • – Elon admits $TESLA runs their own $BTC nodes
  • – Tesla stops accepting $BTC citing environmental concerns from mining
  • – Ark Investment, a fund holding massive amounts of $TESLA releases Solar $BTC mining paper mentioning specific use cases for mining with Tesla Solar.
  • – Ark Investment buys $20M worth of $BTC
  • – Tesla profits from renewable energy credits will dry out soon, forcing them to look for other ways to monetize excess power
  • – Tesla Powerwalls regularly run into excess energy
  • – With $BTC mining, powerwalls could monetize energy & settle txs a lot faster than traditionally possible
  • – Elon’s goal is to create self sustaining life on Mars
  • – Starlink could enable any Tesla consumer to begin running their own $BTC node, free of internet downtime

 

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Written by:  Narender Charan

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