9 ms·

> That said, Tesla's Bitcoin purchase does make a lot of sense ... They then announced their Bitcoin purchase with fanfare that drove the price up, marking a qu

by lph 6y ago

> That said, Tesla's Bitcoin purchase does make a lot of sense ... They then announced their Bitcoin purchase with fanfare that drove the price up, marking a quick return on their investment. Tesla is a car manufacturer! It doesn't make any sense at all! At any company that made sense, a CEO would lose his job for gambling $1B of company money in a casino totally unrelated to the company's business interests.

toyg 6y ago
Well, it’s not completely unrelated: bitcoin drives energy consumption, which in turn drives demand for batteries of all shapes, which are a massive part of Tesla’s business plan.
- unnouinceput 6y ago
  Again with the energy point. The energy is insignificant compared with almost anything else. Wasn't some article that the sum of all standby electronics uses more energy than bitcoin and that's only in US? What are you, Apple? That gives no charger for "environmental reasons" while packaging its wireless headphones in a crapload of unnecessary plastics. If you are so energy consciousness then go bark at US military, those are the biggest polluters and energy hungry of the world.
  - nkohari 6y ago
    The energy required to provide standby power for every electronic device in the United States is a tremendous amount of electricity.
  - tsimionescu 6y ago
    Bitcoin consumes more electricity than entire countries - more than the Czech Republic for example. It consumes a third (or was it a fifth?) of all the electricity of all data centers in the world. It is by no means insignificant.
    - whoanow 6y ago
      If bitcoins price continues to rise, miners will be greatly incentivized to further decrease power costs. I hope this leads to innovation in clean power tech, especially in developing nations.
      - differentView 6y ago
        If bitcoin price continues to rise, wouldn't the power cost become relatively smaller? Wouldn't miners care less?
        mlyle 6y ago
        The amount of money for a given amount of energy spent mining you get is effectively Bitcoin price / difficulty. If Bitcoin price goes up, then the return on energy gets greater. Therefore, it's worth it to spend more energy mining. Then difficulty rises and takes this incentive away, reaching a new equilibrium with more energy spent.
      - ohgodplsno 6y ago
        Right. 60% of the hashrate in China, where 60% of the power comes from coal, to mine a useless coin. If miners could burn cyanide to mine, they would. They don't give a single shit about clean energy, just cheap energy
        vmception 6y ago
        so upwards of ~36% of Bitcoin mining is coal powered. yes, that fits all the estimates that Bitcoin mining is almost a supermajority using renewable energy at some plants and and curbing pollution as a sustainability solution at other plants.
        ohgodplsno 6y ago
        1/ Bitcoin itself might be 100% on renewables. But it's still causing a need for non renewables to be used, to compensate for the fact that you're mining a useless coin. I'd rather have us use this energy in a useful way. 2/ Bitcoin is causing _more_ energy consumption. It's not curbing pollution, in any way. It's just grafting itself where the energy is cheap. Noone's building wind farms for bitcoin. 3/ If I cut off 36% (which is a low bound, other countries are not clean either) of your salary, go ahead and tell me it's okay because you still have the supermajority of it.
- SergeAx 6y ago
  How's that energy consumption drives demand for batteries? Does gas consumption drives demand for spare gas canisters? IMHO rising energy price is totally not good for Tesla's and other electric car manufacturers. It increases TCO of electric vehicles and companies' cost of support for premium models with free charging access.
  - toyg 6y ago
    Higher energy consumption -> higher demand for effective generation from all sources, including renewables -> higher demand for batteries to manage non-continuous supply, which is fairly typical of many renewables (wind, solar, etc). Energy-prices fluctuations are relatively irrelevant in the long run. Oil will run out, and renewables are the only hope to address energy needs without killing the planet. This message is well-understood by now, the transition has started, it’s just a matter of how fast (or slow) we get to the new normal.
Lorin 6y ago
I'm afraid it makes sense if they are hedging bets against a major global economy...
- CerealFounder 6y ago
  God this point doesnt make sense. Bitcoin exists in lands that are governed by men. The governments could make it valueless at the first sign of threat to political currency. BTC is not a hedge, it's just an asset class that is growing fast and gaining attention faster than adoption.
- ac29 6y ago
  Hedging against what? There are plenty of ways to hedge against inflation risk or currency risk without buying into an asset that can lose 50% or more of its value very quickly (and has, a number of times).
  - VoiceOfWisdom 6y ago
    How would you suggest hedging against the death of fiat currency without buying a non fiat currency?
    - JumpCrisscross 6y ago
      > How would you suggest hedging against the death of fiat currency without buying a non fiat currency? We’re aware there are non-U.S. dollar currencies out there? And non-currency assets one can buy?
    - phs318u 6y ago
      Maybe it's just me, but if we truly see the (global) death of fiat currency, the inability of Elon Musk to sell a Tesla is gonna be among the very least of anyone's problems.
      - solveit 6y ago
        In general yes, but I think Musk's inability to sell Teslas is going to be a major problem for the particular person deciding whether Tesla buys BTC or not.
cat199 6y ago
yes .. but elon (handwaving wooo)
trident5000 6y ago
https://www.youtube.com/watch?v=w4Fg88vG4E8 https://www.youtube.com/watch?v=w4Fg88vG4E8
Consultant32452 6y ago
What Elon understands is that if you are interesting you don't have to pay for advertising. Tesla got hundreds of millions in advertising for this and it cost them nothing but a bit of risk on some of their cash position.
tyre 6y ago
Tesla's stock has never been a car manufacturer stock. That's why it has so much short-selling against it. If you value it as a car manufacturer and compare it's (underlying business numbers):(stock price) to anything else, it's insane. "at any company that made sense" is true, to a point. But the point of tesla has been, for a not-insignificant number of people, not meant to make sense. It's faith based. It's cult based. Elon Musk has strong parallels to Trump's appeal. It might not make sense. That's not the point.
- RapidFire 6y ago
  >Elon Musk has strong parallels to Trump's appeal. Isn't that the strangest thing? If you watch videos of Elon he is no where near as charismatic as trump. I think it mostly stems from his success with SpaceX and earning accolades for being, "The Guy who does Impossible things". His having a car manufacturing company with an impossible share price just make sense.
  - danans 6y ago
    I think the similarity is less their personalities, and more in their use social media for shock value and attention, and the quasi-religious devotion of many of their supporters.
- spoonjim 6y ago
  Despite seeming like polar opposites they have a lot of similarities. A great knack for “triggering” their detractors, and a hyperdefensiveness in the face of criticism.
  - Jon_Lowtek 6y ago
    i think it is called "cult of personality", "great man theory" or "hero worship" and it is probably related to medieval kings and queens, religious prophets and why some monkeys are more equal than others.
- didibus 6y ago
  The challenge for Tesla and Elon is that I don't see the exit strategy? If Elon sells off his Tesla shares in any sizable quantity, it seems the stock would drop massively. If Elon steps down his involvement or passed away, same thing. So it seems it needs to keep on the show until Tesla can actually sustain its value somehow through normal business operations.
hogFeast 6y ago
You didn't hear about SolarCity?
fbelzile 6y ago
I'm just guessing here but they might be hedging against future trade restrictions set by China against US companies like Tesla. If another trade war was to happen, people in China might be able to buy a Tesla using Bitcoin vs having to buy a NIO.
- kbuck 6y ago
  I think there are a couple issues with this idea: firstly, they'd be accepting the Bitcoin, so they wouldn't need any on hand to process the purchases. Secondly, if China wants to prevent or restrict the sale of a physical good, especially one as large as a car, it's far easier to stop it from being imported (or manufactured) than to stop people from paying for it.
- 2020aj 6y ago
  Cars are regulated beyond just the point of sale. I believe it would be rather difficult to get said car registered (presuming there's a Chinese equivalent to vehicle registration), if you could even arrange receipt in the first place ;)
- root_axis 6y ago
  How do you imagine that pans out for the Chinese buyer?
Bakary 6y ago
It makes sense in a solidly virtualized casino economy
otabdeveloper4 6y ago
> Tesla is a car manufacturer! That's what you think.
rdtwo 6y ago
Tesla is a hype company with a small side gig in mfg
- zzbzq 6y ago
  Tesla is a company that posts to reddit screenshots of tweets about subjects scraped from reddit. With a small side gig collecting government energy subsidies.
  - deleted 6y ago
    [deleted]
webinvest 6y ago
Tesla is a stock sales company that has a side business in manufacturing new toys & breakthroughs

by lph 6y ago

toyg 6y ago

Well, it’s not completely unrelated: bitcoin drives energy consumption, which in turn drives demand for batteries of all shapes, which are a massive part of Tesla’s business plan.

unnouinceput 6y ago
Again with the energy point. The energy is insignificant compared with almost anything else. Wasn't some article that the sum of all standby electronics uses more energy than bitcoin and that's only in US? What are you, Apple? That gives no charger for "environmental reasons" while packaging its wireless headphones in a crapload of unnecessary plastics. If you are so energy consciousness then go bark at US military, those are the biggest polluters and energy hungry of the world.
- nkohari 6y ago
  The energy required to provide standby power for every electronic device in the United States is a tremendous amount of electricity.
- tsimionescu 6y ago
  Bitcoin consumes more electricity than entire countries - more than the Czech Republic for example. It consumes a third (or was it a fifth?) of all the electricity of all data centers in the world. It is by no means insignificant.
  - whoanow 6y ago
    If bitcoins price continues to rise, miners will be greatly incentivized to further decrease power costs. I hope this leads to innovation in clean power tech, especially in developing nations.
    - differentView 6y ago
      If bitcoin price continues to rise, wouldn't the power cost become relatively smaller? Wouldn't miners care less?
      - mlyle 6y ago
        The amount of money for a given amount of energy spent mining you get is effectively Bitcoin price / difficulty. If Bitcoin price goes up, then the return on energy gets greater. Therefore, it's worth it to spend more energy mining. Then difficulty rises and takes this incentive away, reaching a new equilibrium with more energy spent.
    - ohgodplsno 6y ago
      Right. 60% of the hashrate in China, where 60% of the power comes from coal, to mine a useless coin. If miners could burn cyanide to mine, they would. They don't give a single shit about clean energy, just cheap energy
      - vmception 6y ago
        so upwards of ~36% of Bitcoin mining is coal powered. yes, that fits all the estimates that Bitcoin mining is almost a supermajority using renewable energy at some plants and and curbing pollution as a sustainability solution at other plants.
        ohgodplsno 6y ago
        1/ Bitcoin itself might be 100% on renewables. But it's still causing a need for non renewables to be used, to compensate for the fact that you're mining a useless coin. I'd rather have us use this energy in a useful way. 2/ Bitcoin is causing _more_ energy consumption. It's not curbing pollution, in any way. It's just grafting itself where the energy is cheap. Noone's building wind farms for bitcoin. 3/ If I cut off 36% (which is a low bound, other countries are not clean either) of your salary, go ahead and tell me it's okay because you still have the supermajority of it.
SergeAx 6y ago
How's that energy consumption drives demand for batteries? Does gas consumption drives demand for spare gas canisters? IMHO rising energy price is totally not good for Tesla's and other electric car manufacturers. It increases TCO of electric vehicles and companies' cost of support for premium models with free charging access.
- toyg 6y ago
  Higher energy consumption -> higher demand for effective generation from all sources, including renewables -> higher demand for batteries to manage non-continuous supply, which is fairly typical of many renewables (wind, solar, etc). Energy-prices fluctuations are relatively irrelevant in the long run. Oil will run out, and renewables are the only hope to address energy needs without killing the planet. This message is well-understood by now, the transition has started, it’s just a matter of how fast (or slow) we get to the new normal.

Lorin 6y ago

I'm afraid it makes sense if they are hedging bets against a major global economy...

CerealFounder 6y ago
God this point doesnt make sense. Bitcoin exists in lands that are governed by men. The governments could make it valueless at the first sign of threat to political currency. BTC is not a hedge, it's just an asset class that is growing fast and gaining attention faster than adoption.
ac29 6y ago
Hedging against what? There are plenty of ways to hedge against inflation risk or currency risk without buying into an asset that can lose 50% or more of its value very quickly (and has, a number of times).
- VoiceOfWisdom 6y ago
  How would you suggest hedging against the death of fiat currency without buying a non fiat currency?
  - JumpCrisscross 6y ago
    > How would you suggest hedging against the death of fiat currency without buying a non fiat currency? We’re aware there are non-U.S. dollar currencies out there? And non-currency assets one can buy?
  - phs318u 6y ago
    Maybe it's just me, but if we truly see the (global) death of fiat currency, the inability of Elon Musk to sell a Tesla is gonna be among the very least of anyone's problems.
    - solveit 6y ago
      In general yes, but I think Musk's inability to sell Teslas is going to be a major problem for the particular person deciding whether Tesla buys BTC or not.

cat199 6y ago

yes .. but elon (handwaving wooo)

trident5000 6y ago

https://www.youtube.com/watch?v=w4Fg88vG4E8 https://www.youtube.com/watch?v=w4Fg88vG4E8

Consultant32452 6y ago

What Elon understands is that if you are interesting you don't have to pay for advertising. Tesla got hundreds of millions in advertising for this and it cost them nothing but a bit of risk on some of their cash position.

tyre 6y ago

Tesla's stock has never been a car manufacturer stock. That's why it has so much short-selling against it. If you value it as a car manufacturer and compare it's (underlying business numbers):(stock price) to anything else, it's insane. "at any company that made sense" is true, to a point. But the point of tesla has been, for a not-insignificant number of people, not meant to make sense. It's faith based. It's cult based. Elon Musk has strong parallels to Trump's appeal. It might not make sense. That's not the point.

RapidFire 6y ago
>Elon Musk has strong parallels to Trump's appeal. Isn't that the strangest thing? If you watch videos of Elon he is no where near as charismatic as trump. I think it mostly stems from his success with SpaceX and earning accolades for being, "The Guy who does Impossible things". His having a car manufacturing company with an impossible share price just make sense.
- danans 6y ago
  I think the similarity is less their personalities, and more in their use social media for shock value and attention, and the quasi-religious devotion of many of their supporters.
spoonjim 6y ago
Despite seeming like polar opposites they have a lot of similarities. A great knack for “triggering” their detractors, and a hyperdefensiveness in the face of criticism.
- Jon_Lowtek 6y ago
  i think it is called "cult of personality", "great man theory" or "hero worship" and it is probably related to medieval kings and queens, religious prophets and why some monkeys are more equal than others.
didibus 6y ago
The challenge for Tesla and Elon is that I don't see the exit strategy? If Elon sells off his Tesla shares in any sizable quantity, it seems the stock would drop massively. If Elon steps down his involvement or passed away, same thing. So it seems it needs to keep on the show until Tesla can actually sustain its value somehow through normal business operations.

hogFeast 6y ago

You didn't hear about SolarCity?

fbelzile 6y ago

I'm just guessing here but they might be hedging against future trade restrictions set by China against US companies like Tesla. If another trade war was to happen, people in China might be able to buy a Tesla using Bitcoin vs having to buy a NIO.

kbuck 6y ago
I think there are a couple issues with this idea: firstly, they'd be accepting the Bitcoin, so they wouldn't need any on hand to process the purchases. Secondly, if China wants to prevent or restrict the sale of a physical good, especially one as large as a car, it's far easier to stop it from being imported (or manufactured) than to stop people from paying for it.
2020aj 6y ago
Cars are regulated beyond just the point of sale. I believe it would be rather difficult to get said car registered (presuming there's a Chinese equivalent to vehicle registration), if you could even arrange receipt in the first place ;)
root_axis 6y ago
How do you imagine that pans out for the Chinese buyer?

Bakary 6y ago

It makes sense in a solidly virtualized casino economy

otabdeveloper4 6y ago

> Tesla is a car manufacturer! That's what you think.

rdtwo 6y ago

Tesla is a hype company with a small side gig in mfg

zzbzq 6y ago
Tesla is a company that posts to reddit screenshots of tweets about subjects scraped from reddit. With a small side gig collecting government energy subsidies.
- deleted 6y ago
  [deleted]

webinvest 6y ago

Tesla is a stock sales company that has a side business in manufacturing new toys & breakthroughs