from the chiasmus archive: “Inflation and the Finite endgame”: BITCOIN, Elon Musk’s manipulation and its carbon footprint from Hell. Posted on May 15, 2021 by CHIASMUS MAGAZINE BLOG
Bitcoin’s meteoric rise is nothing less than an astounding feat, yet despite the rise of this speculative asset which has been attributed to numerous reasons from an inflation hedge to safe haven flows, which are incorrect assertions, the reason for increment price increases of Bitcoin would be in correlation to the rise of costs of producing a Bitcoin that is mined through server centers. However the main reason for its overbought appeal with its political and feigned idealism that fortune can be made in an unregulated market, is through the billionaire Elon Musk’s cherry picked libertarianism. Declaring that Bitcoin and cryptocurrencies will be the currencies of the future has attributed to its stellar popularity. More so, lesson known cryptocoins such as Dogecoin are now be promoted by the world’s richest man, to which Musk has stated that the coin will fund the SpaceX trip to the moon and one day be the currency of choice for his Paleo-libertarianism community on Mars. Although the inconsistent and at times odd behavior of the billionaire, particularly when using Twitter as his proxy voice box to influence the price of cryptocurrencies, the Security and Exchange Commission (SEC) has little jurisdiction over, as cryptocurrencies are not a security. This free-reign of speculation and greed projected as a free market ideology on Twitter has been constant to his millions of followers, yet, the capricious tirade of speculation pump and dump calls comes at a price for the average poorer investor, who, in contrast to the amassed wealth of Musk, is the one who could be be trapped by Bitcoin’s volatility.
On the 29th January 2021, Musk changed his Twitter name to #bitcoin with later dialogue attached another ‘tweet’ saying “in retrospection, it was inevitable”. Bitcoin quickly rallied from its low of $29,239.87 on the 01/27/2021 (Chart 1) closing on the day, after Musk tweet, at $34,271.43 (Chart 2) this rallying gaining over 16%. With first quarter reporting season approaching for 2021, according to analysis via Shawn Tully from Fortune.com, Musk through his company Tesla was buying up feverishly between 1/1/2021 and 08/2/2021 pumping up the investment of its Bitcoin holdings to $1.5 billion, this can be seen on the above Bitcoin Chart/s 3 and 4, from the lows of $28,705.34 it rallied to a high of $46,734.42 on 08/02/2021 an astounding jump in value of $18,029.28. In its Q1 earnings report, Musk’s company Tesla divulged that it sold 10% of its holdings of Bitcoin attributing to $272 million, which was bought, according Tully for $171 million, booking a profit for Tesla at 101million. Bitcoin hit all time highs on the March the 12th 2021 at $63,583.05, Musk, in talking up Bitcoin as a buy throughout 2020 and into 2021, had actually sold, through Tesla, as revealed by the companies Q1 report. There is a further element to Musk, Telsa and Bitcoin’s buy and sell (pump and dump) saga to which the legions of Twitter and Reddit followers are caught up in, which holds a strange, yet familiar irony of what happens when equities are over juiced and companies are financially over capitalized. The age old whiff of corruption becomes evident when a company begins using its holdings as an investment fund, rather than continued development into the company itself. The kicker here, and there are plentiful with Musk’s Tesla, is, according to Tully’s article, Telsa’s investment in Bitcoin actually made more than the Tesla itself for Q1.
Bitcoin is not only a heavily manipulated asset, which holds very little (if any) intrinsic value any more than its speculative value, it is also a energy consuming beast, according to Cambridge Bitcoin Electricity Consumption Index (University of Cambridge) Bitcoin mining consumes 150 of terrawatt-hour (Twh) every year. The process of “blockchain” mining is known as developing answers to more complex puzzles via amass of computer arrays to produce a single Coin, which in relation to Bitcoin, uses the same amount of energy as whole of Poland. Hence why China is attractive as an en masse Blockchain miner, as the country produces 75% of global Bitcoin mining, namely because it uses “Coal Fire” power stations as a energy provider, that overall contributes to 57% of the energy used to power the Chinese economy. With demand for this digital asset in comparison to the energy that it uses may also be reflective in its price, yet Cryptocurrencies touted as a future currency is no less than a fantasy, in light of its carbon emitting overkill and almost completely reliant on China to mine these coins cheaply with coal fire power. Once again, we must interject with the wayward behavior of Musk, who, in his Bitcoin and Cryptocurrency drenched mania via, or course, Twitter, issued a statement on May 13th 2021 saying that Tesla will not take any Bitcoins as transactional asset for the companies electrical cars. Sending the cryptocurrency down $45,700, which was in response to that very issue that Bitcoin is a carbon emitting behemoth. Strange fellow indeed, but rich, to the over hype of Bitcoin and the crony that he be the sole instigator of the asset fluctuations, it must be reminded that Tesla has accumulated over 4 billion in American tax payer subsidizes to create renewable carbon free (electrical) cars, batteries, solar panels and the private freight space company SpaceX.
It’s a beautiful world.
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