“lettuce hands” is an expression some people use to describe an investor who sells their bitcoin at the first sign of trouble, often at a loss. An example of its use in a sentence could be: “elon musk has lettuce hands because he sold 75% of tesla’s bitcoin holdings in the second quarter.”
The above sentence is just an example; happens to be the truth. During the webcast of Tesla’s quarterly results last week, Musk admitted to spending some $936 million in Bitcoin to raise cash due to concerns about an economic downturn due to the pandemic lockdowns in China. The CEO said he sold for a “realized gain,” but some people online have serious doubts.
Reading: Bitcoin adoption rate
To be fair, Musk added that he was open to buying more in the future. But to many bitcoin fans and supporters, his decision to sell feels like a betrayal, especially since he still owns the dogecoin meme coin, created in 2013 as a joke.
When tesla initially announced in February 2021 that it had purchased $1.5 billion worth of bitcoin, the crypto community saw this as a sign of the start of a trend of large companies and other institutional investors holding the digital asset on their balance sheets. Excitement only increased the following month when the electric vehicle (EV) maker announced that it would begin accepting bitcoin as a form of payment.
These plans lasted a little over a month before musk suspended bitcoin payments. the reason? mining the asset, he claimed, consumed too much energy and emitted a lot of greenhouse gases.
We now know that Musk’s concerns, while valid, were and are not based on truth. some might call them fud, or fear, uncertainty, and doubt.
Bitcoin miners are the “buyers of last resort” when it comes to sustainable energy
musk is right about one thing: mining bitcoin is energy intensive, no question about it, and it will only consume more and more energy per coin as the difficulty rate increases.
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Where he is wrong is saying that bitcoin mining is dirtier than other industries. The truth is that the use of non-carbon emitting, renewable energy by institutional-sized miners has been shown to be higher on average than that of any large country on earth.
Below are the results of the second quarter survey of members of the bitcoin mining council (bmc), of which hive blockchain technologies is a founding member. According to the data, sustainable energy (wind, solar, hydroelectric, geothermal, etc.) represents an impressive 66% of the energy mix of bmc members. for the entire global bitcoin network, it is almost 60%. no g20 country comes close to using that level of renewable energy as a percentage of total energy use.
And as many others have pointed out, including myself, large-scale Bitcoin miners are very often the buyers of last resort when it comes to renewable energy. They regularly consume much of the electricity that otherwise would have gone to waste during non-peak hours. This makes sustainable energy more competitive and will encourage further deployment of wind and solar.
dennis porter, executive director of the satoshi action fund, whose mission is to educate lawmakers on the merits of bitcoin, goes one step further. Bitcoin mining, he said in a recent tweet, will one day “be such a big part of the network that if they try to ban it, we’ll all run out of power.”
One day, #bitcoin mining will be such a big part of the network that if they try to ban it, we’ll all be without electricity.
despite all this, tesla still has no plans to start accepting bitcoin as payment again. the only digital asset it accepts is dogecoin, whose market capitalization is only 2% the size of bitcoin.
shanghai lockdown is a challenge for tesla in Q2
however, we still like tesla. Shutdowns in Shanghai were a big challenge for the automaker in the second quarter, with profits down compared to the previous quarter. however, now that the factories are back up and running, we expect to see stronger results when the company reports the third quarter.
Like tech stocks and luxury goods stocks, of which Tesla is considered a member, stocks have dipped into bear market territory this year due to rising rates, recession fears and problems. of the global supply chain.
Global Bitcoin Adoption to Hit “Parabolic Phase” in 2030
Tesla’s suspension of bitcoin payments raises questions about the viability of the digital asset as a widely accepted currency and medium of exchange. more and more businesses and retailers will take your bitcoin, but so far, relatively few transactions take place using the crypto. according to one source, bitcoin currently processes only about seven transactions per second compared to visa’s 1,700 and mastercard’s 5,000.
But it won’t be like this forever, says the latest research from blockchain infrastructure company’s blocking software solutions.
In a June report, the company looks at historical adoption trends for a number of previous disruptive technologies, including automobiles, radio, the internet, smartphones and more. although the speed of adoption in these cases differed, one thing was certain: once adoption reached 10% of the population, growth became “parabolic” as penetration shifted from “early adopters” to ” early majority” and finally to the “late adopters”. majority.”
To summarize, blockchain software predicts that global bitcoin adoption will exceed 10% in the year 2030. After that, growth could turn parabolic, eventually reaching 80% of the population in the 2050s.
Just as a reminder, Bitcoin supply is capped at 21 million. Divide that among 8 billion people, which is what global population is projected to reach later this year. The model above suggests that owning just one whole Bitcoin and holding it for the long haul could end up generating not only life-changing wealth but generational wealth.
Missed the hive blockchain results for fiscal year 2022? watch the replay by clicking here!
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Stocks may change daily. holdings are reported at the end of the most recent quarter. the following securities mentioned in the article were held by one or more accounts managed by us. global investors as of (06/30/22): tesla inc.
