Musk tells governments to “do nothing” on crypto regulation
Crypto fundamentally reduces the power of centralized governments, says the Tesla CEO
Speaking at the Code Conference in California, SpaceX and Tesla CEO Elon Musk stated that the United States government should refrain from attempting to regulate the crypto industry, amid rising global regulatory scrutiny of digital assets.
Musk, who recently reclaimed the title of the world’s richest person, called cryptocurrencies “indestructible” and pointed out that intervention from the government would only slow down the advancement of the technology. He admitted that while he wouldn’t consider himself a massive crypto expert, he believed that regulators should steer clear of slowing down the mass adoption of cryptocurrencies.
“I would say, ‘Do nothing,’” Musk said, responding to a question from New York Times columnist Kara Swisher on whether US financial regulators should be involved in regulating crypto.
The CEO also addressed increasing concerns in the crypto community regarding the regulatory crackdown in China. The country has undertaken a series of tough measures to counter cryptocurrencies weeks after the central bank warned financial institutions against providing services to crypto firms. With provincial governments suspending the provision of hydroelectricity to crypto mining operations, several major mining pools such as Sparkpool are shutting down.
Musk stated that the massive electricity generation shortage coupled with random power outages in South China might have influenced the government’s stance.
“…the power demand is higher than expected,” Musk stated, adding that “Crypto mining might be playing a role in that.”
However, on a higher level, Musk believed that the decision may be a result of viewing cryptocurrencies as a challenge to the Chinese government.
Cryptocurrencies are fundamentally aimed at reducing the power of centralized governments, a fact that might not sit well with the Chinese authorities, he explained.
Musk’s endorsements of cryptocurrencies including Dogecoin, Bitcoin, and Shiba Inu have been widely linked with the price movements of these tokens in the market, establishing the CEO as a crucial crypto price influencer.
While Tesla’s $1.5 billion investment in Bitcoin led to a market-wide price surge in February, Musk was criticized by the community after Tesla suspended Bitcoin payments causing a price drop in May 2021.