Musk's 180-degree turn: The value of Bitcoin is based on "energy", not a flaw but a characteristic!

The world's richest man and the leader of platform X, Elon Musk, made astonishing remarks about Bitcoin again, declaring that he has completely changed his view on Bitcoin. This week, Musk publicly stated that the value of Bitcoin is based on energy, which is in stark contrast to his position in 2021 when he criticized its energy consumption as “crazy” and paused Tesla's Bitcoin payments. He regards Bitcoin as a hard asset that escapes “devaluation trading” and stated, “You can issue fake fiat, but you cannot counterfeit energy.” This shift marks Musk's full acceptance of the core defense of Bitcoin supporters that “Proof of Work (PoW) is inherent to its nature,” and it also announces the end of the “energy FUD” era in the crypto community.

Musk's Philosophical Shift: From “Energy Madman” to “Energy Philosopher”

Elon Musk's latest remarks signify his understanding of the Bitcoin Proof of Work mechanism, shifting from environmental threats to philosophical recognition.

· The new assertion that “energy is the foundation of value”

Musk's latest comments were made during a discussion about the arms race in artificial intelligence (AI). He believes that the rise of Bitcoin and gold is because investors are fleeing from “devaluation trades” (i.e., the act of governments printing money to fund the AI boom).

• Musk wrote: “This is why Bitcoin is energy-based. You can issue fake fiat, every government in history has done this, but forging energy is impossible.”

· Adopt “Proof of Work characteristics”

This assertion stands in stark contrast to his position in 2021. That year, he referenced the Bitcoin electricity consumption index data from Cambridge University, stating that the network's electricity usage was “crazy,” which led Tesla to stop accepting BTC payments, and subsequently sold about 75% of its Bitcoin holdings in 2022.

• Now, Musk is echoing the favorite argument of Bitcoin supporters: Proof of Work is not a flaw, but a feature. This aligns with MicroStrategy executive Michael Saylor's view that “natural law is superior to human law.”

The Physics of Value: Energy Costs and Counterfeit Resistance

As someone who has achieved success in the fields of rocket science, solar energy, and electric vehicles, Musk ultimately sees Bitcoin as another expression of “energy is truth.”

· Energy anchors the value of the real world

The argument for Bitcoin is: unlike fiat currencies that can be inflated at will, the supply of Bitcoin is fixed, and each coin is “mined” through the consumption of energy from the real world. This energy cost anchors Bitcoin in the physical world.

· Countering “fake” data in the AI era

In an era where AI is inundating the internet with synthetic content (text, art, data), the PoW mechanism of Bitcoin stands out as an irrefutable proof of authenticity. Musk believes that you can deeply fake humans (Deepfake), but you cannot deeply fake joules (unit of energy).

· Tesla is still holding Bitcoin

Despite Tesla selling off most of its Bitcoin in 2022, the company still holds 11,509 Bitcoins, worth approximately $1.28 billion at current prices. This indicates that Musk has never fully left the world of encryption; he has merely dimmed the spotlight temporarily.

Market Trend Shift: The End of the “Energy FUD” Era

Musk's 180-degree turnaround highlights that the narrative around Bitcoin's energy consumption is undergoing a broader shift in the industry.

· The focus shifts to energy types

The era of “energy FUD” (fear, uncertainty, and doubt) is over. The focus of discussion has now shifted from how much energy Bitcoin uses to what kind of energy it uses and what that energy represents.

· Mining leans towards sustainable energy

Estimates suggest that over 55% of Bitcoin mining currently relies on sustainable energy - a figure that meets the conditions set by Musk in 2021 for restoring BTC payments.

Conclusion

Elon Musk once called Bitcoin's energy consumption “crazy,” but now refers to it as “inexhaustible.” The truth of the matter is that Bitcoin's high energy consumption is precisely the reason for its existence. This cost of creation endows it with value in the physical world, just as any real endeavor requires energy consumption. Musk's ultimate understanding and public affirmation of this undoubtedly adds significant celebrity endorsement to Bitcoin's value storage narrative and marks the further maturation of institutions' and the public's understanding of the PoW mechanism.

This article is news information and does not constitute any investment advice. The cryptocurrency market is highly volatile, and investors should make decisions cautiously.