Lee, who is the head of research at Fundstrat, said he understands Musk’s decision to suspend bitcoin payments.”I imagine it would have been tough to accept bitcoin as payment because of the volatility,” he told Insider.”So as a practical, treasury matter, unless Tesla is hedging the bitcoin transaction at the time of purchase, I don’t know if it’s great from a company perspective.”He added that the ideal way to use bitcoin would be if Tesla transacted the same day, rather than allowing customers to pay first and get the car at a later time, at which point bitcoin may be worth less.As for the burning question of why Musk made the decision now, Lee said it is possible it was influenced by people within the organization.
“Many people come to Tesla because it’s ESG-friendly,” he said, referring to environmental, social, and governance metrics closely tracked by many investors.”I think some of these same people might’ve just questioned, well, if you want to accept a digital currency…maybe it shouldn’t be bitcoin,” he said.Concerns around bitcoin’s energy consumption have hounded the world’s most valuable cryptocurrency.To verify transactions, thousands of computers must be powered, a process that relies on huge amounts of electricity, which critics say comes mostly from fossil fuel sources.Other potentially more energy-efficient options include Chia, a new greener cryptocurrency, and Ripple’s XRP, said to be the least environmentally damaging among crypto coins.Read more: ‘Wolf of All Streets’ crypto trader Scott Melker breaks down his strategy for making money using ‘HODLing’ and 100-times trade opportunities – and shares 5 under-the-radar tokens he thinks could explode Musk himself though may be leaning towards dogecoin.
On Thursday, the Tesla chief said he is “working with Doge devs to improve system transaction efficiency.”Where bitcoin needs to consume about 707-kilowatt hours for each transaction, dogecoin only requires about 0.12 , as the meme token uses fewer calculations to mine and trade coins.Still, Lee doubled down on the merits of bitcoin, highlighting how the bitcoin system never had a single fraudulent entry in its entire history since it was founded in 2009.Lee said he’s undeterred by bitcoin’s waning market dominance as the token’s market capitalization falls below 50% of the entire crypto market.”Bitcoin dominance will actually grow during a bear market,” he said..
