Elon Musk, the CEO of Tesla, warned on Tuesday that the US government should avoid attempting to control the cryptocurrency market. “I don’t think it’s possible to destroy crypto, but it is possible for governments to stifle its progress,” Musk stated at the Code Conference in Beverly Hills, California.
Elon Musk on U.S Crypto regulation
Musk was answering on stage a question from Kara Swisher of the New York Times. She inquired as to whether the US government should be involved in crypto regulation. “I would say, ‘Do nothing,’” he said.
Tesla announced in January that it has purchased $1.5 billion in bitcoin. As bitcoin prices rose, the value of those holdings increased to around $2.5 billion in the second quarter. Bitcoin, like other cryptocurrencies, has since fallen in value.
Musk, who has repeatedly shown his support for various digital currencies on Twitter, is optimistic about the role of crypto in decreasing “error and latency” in conventional financial systems. However, he admitted that crypto did not have all of the answers to society’s problems.
Musk stated, “I wouldn’t say I’m a massive Bitcoin specialist.” “I believe bitcoin has some worth, but I wouldn’t call it the second coming of the Messiah.”
Musk on China’s crypto crackdown
Musk also spoke about China’s role in cryptocurrency mining and regulation.
China’s central bank announced harsher steps in its broader crypto crackdown last week, including beefed-up infrastructure to track crypto-related transactions.
The heavy hand, Musk added, is most likely due to the country’s “severe electrical generation challenges.” Musk speculated that “part of it may possibly be due to electrical constraints in many parts of China.”
China’s central bank declared all cryptocurrency-related transactions illegal on Friday, and international exchanges are forbidden from providing services to Chinese residents, in its strongest crackdown yet on the digital asset industry.
“Random power disruptions are happening across most of South China right now due to higher-than-expected electricity demand”. The decentralized character of cryptocurrencies may pose a challenge to the Chinese government at a higher level. Musk explained, “I suppose cryptocurrency is primarily geared at decreasing the power of a centralized government.” “That irritates them.”
Musk also co-founded SpaceX, which completed the first all-tourist mission to circle the planet earlier this month. He and Amazon founder Jeff Bezos are locked in a heated space race, with the two billionaires sparring on social media as well as through regulators and other legal channels.
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