Elon Musk says the U.S. Government Should Steer Clear of Regulating Cryptocurrency

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Elon Musk, Bitcoin, Dogecoin
Elon Musk, Bitcoin, Dogecoin

Elon Musk, the second richest man in the world and the CEO of the electric cars manufacturer Tesla (NASDAQ: TSLA) said on Tuesday that the U.S. government should keep away from regulating the cryptocurrency market.

 “It is not possible to, I think, destroy crypto, but it is possible for governments to slow down its advancement,” Musk said at the Code Conference in Beverly Hills, California.

Kara Swisher a New York Times columnist asked Musk about whether the U.S. government should be involved in regulating the crypto market. 

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 “I would say, ‘Do nothing,’” he responded.

Earlier this year, Tesla announced the purchase of $1.5 billion worth of Bitcoin. Since then, the largest cryptocurrency gained an additional $1 billion in value turning the company’s Bitcoin holdings into a thrilling $2.5 billion in less than a year. However, the digital token price plummeted alongside other altcoins due to regulations imposed by countries such as China.

Musk, an advocate for cryptocurrencies and the “Dogefather” of the meme-based digital currency Dogecoin has always shown its support to digital currencies. The billionaire has contributed to several price surges in crypto token prices following his tweets. Musk always argued cryptocurrencies are reducing the “error and latency” in the legacy money systems. 

“I wouldn’t say that I’m a massive cryptocurrency expert,” said Musk. “I think there’s some value in cryptocurrency, but I wouldn’t say it’s the second coming of the Messiah.”

Musk comments on China’s crypto crackdown

Musk mentioned China’s continued crackdown on crypto mining and illegalizing crypto transactions. 

Last week, China’s central bank imposed harsh measures on the cryptocurrency space. The Asian country illegalized transactions in crypto and prohibited the mining of any digital currency.

Musk said the heavy hand likely has to do with the country’s “significant electricity generation issues.”

“Part of it may actually be due to electricity shortages in many parts of China,” said Musk. “A lot of South China right now is having random power outages, because the power demand is higher than expected.”

“Crypto mining might be playing a role in that,” he said.

At a higher level, the decentralized nature of cryptocurrencies may present a challenge for the Chinese government.

“I suppose cryptocurrency is fundamentally aimed at reducing the power of a centralized government,” Musk said. “They don’t like that.”