Bitcoin keeps falling in price.
Angela Lang / CNET
Bitcoin reached the $ 1 trillion market capitalization mark last week. It appears, however, that a tweet from Tesla CEO Elon Musk, a few words of caution from Treasury Secretary Janet Yellen, and comments from Microsoft co-founder Bill Gates are rapidly dropping their value.
The popular cryptocurrency fell to just over $ 47,000 on Tuesday after breaking the $ 58,000 mark on Sunday afternoon. Musk tweeted on Saturday that “BTC and ETH look high lol”, referring to Bitcoin and the Ethereum digital currency. Musk’s tweet was part of a response to a Peter Schiff’s tweet, chief market strategist at broker Euro Pacific Capital, on the value of Bitcoin in relation to the gold-backed currency.
In an interview with Bloomberg, Gates gave his take on Bitcoin and the idea that it could be affected so dramatically by a tweet from Musk.
“I’m not optimistic about Bitcoin,” he said. “If you have less money than Elon, you should probably be careful.”
Gates also expressed concern about the massive energy use of Bitcoin, similar to a point that Yellen made during the DealBook conference on Monday. She commented on how “impressive” the amount of energy used for transactions.
“I don’t think Bitcoin … is widely used as a transaction mechanism,” she said, according to CNBC. “As far as it is used, I fear it is usually for illicit financing. It is an extremely inefficient way of conducting transactions, and the amount of energy consumed in processing those transactions is impressive.”
Bitcoin and other crypto currencies, like Dogecoin, require a lot of computing power in order for people to transact. These heavy computer calculations, also known as mining, need a lot of energy – more than Argentina.
During most of 2020, Bitcoin recovered from its low of just $ 5,000 in April to jump beyond $ 29,000 at the end of the year.