In an interview with Kara Swisher Tuesday at the annual invite-only code conference in Beverly Hills, California, Elon Musk argued that global governments should stay away from trying to regulate bitcoin and cryptocurrencies.
“It is not possible, I think, to destroy cryptocurrencies, but it is possible for governments to slow their progress,” Musk said during an interview with the Red Chair.
When asked if the US government should be involved in regulating bitcoin and cryptocurrency, Musk replied, “I would say, do nothing.”
The comments come at a time when public figures are beginning to assess Bitcoin’s anti-fragility, frankly asking if there is a chance of shutting down the system if it is so successful. Billionaire Ray Dalio made such statements recently, saying that he believes that governments can shut down Bitcoin.
Musk seems to understand the situation more deeply.
On the challenge that decentralizing bitcoin poses to countries, Musk said, “I suppose the cryptocurrency is primarily intended to reduce the power of the central government,” he continued, “they don’t like that.”
However, Musk phrased his statement saying, “I wouldn’t say I am a big cryptocurrency expert. I think there is some value in cryptocurrency, but I wouldn’t say it’s the second coming of Christ.”
Musk owns Bitcoin, his company Tesla and SpaceX now hold the cryptocurrency as a reserve asset. However, his notes show that he does not yet understand the grid’s relationship to energy production and why it is beneficial to his primary industry.
Regarding China’s renewed efforts to ban bitcoin, Musk said the central bank’s crackdown likely had something to do with “big problems with electricity generation.”
“Part of it may actually be due to the lack of electricity in many parts of China,” he said. “A large part of southern China is now experiencing random blackouts, because energy demand is higher than expected.”
Earlier this year, Tesla bought $1.5 billion worth of Bitcoin. The company has also moved back and forth between accepting and discontinuing Bitcoin for Tesla payments this year, citing power usage in the network. Since then, Musk has seemed unwilling to start accepting payments again, even as the available data undermines his company’s decisions.