In an interview with TechCrunch onstage at the Ethereum Denver conference, Tesla board member Kimbal Musk, brother of CEO Elon Musk, said that the company had been “very ignorant” of the environmental impact of Bitcoin when it announced last year that it would purchase $1.5 billion worth of the cryptocurrency and would plan to allow owners to purchase the company’s vehicles with the currency.
“When we invested in Bitcoin, we were very ignorant. We had no idea of the environmental impact, we literally didn’t know, we were like this seems like a good store of value and a good way to diversify assets. And of course, it didn’t take very long to get a million — I’m not kidding probably a million — messages telling us what we were doing to the environment,” said Kimbal Musk, in an interview with this reporter. “And of course, our company is about creating alternative energy futures so we really were not informed enough when we made that decision.”
Kimbal Musk says that while Tesla “didn’t necessarily regret” its Bitcoin purchase, he hopes that the broader blockchain industry can move to more environmentally friendly infrastructure, noting that his own philanthropic organization Big Green had embraced a crypto-native DAO governance structure operating on a less energy-intensive blockchain.
Photo credit: Jesse Morgan // ETH Denver Tesla board member Kimbal Musk discusses the future of philanthropic giving in an interview with TechCrunch’s Lucas Matney at the Ethereum Denver 2022 conference.
“I really do not agree with the environmental impact of crypto, but I love what it does.” Kimbal Musk said onstage. “So we’ve just got to figure out how to do it without the environmental impact…. it’s simply not an option to have this environmental impact.”
Tesla’s decision to buy bitcoin last year prompted a major bull run for the cryptocurrency, though that surge was famously reversed months later by the company’s announcement that while it did not immediately plan to sell its bitcoin, it would no longer be accepting bitcoin as payment for vehicle purchases.
“Cryptocurrency is a good idea on many levels and we believe it has a promising future, but this cannot come at a great cost to the environment,” Elon Musk wrote, partially, in a tweet last May. “Tesla will not be selling any bitcoin and we intend to use it for transactions as soon as mining transitions to more sustainable energy.”
While there is still plenty of missing data around how heavily the Bitcoin mining network relies on renewable energy sources, it is clear just how significant the network’s energy usage is. Estimates from Digiconomist‘s energy tracker suggest that the total annualized energy footprint of Bitcoin’s mining operations has nearly doubled since Musk’s tweet last May. The Bitcoin network contributes as much carbon to the atmosphere as the country of Kuwait does on an annual basis according to the site’s estimates.
Kimbal Musk has served on Tesla’s board since 2004.