Elon Musk Suggests China’s Crypto Crackdown Is About Maintaining Power

  • ‘It would appear they don’t love crypto,’ Musk tells Code Conference crowd.
  • The Tesla CEO used to be a big fan of cryptocurrencies, although his ardor has waned lately.
  • SpaceX co-founder also jokes about Blue Origin, the space company owned by Amazon’s Jeff Bezos.

Elon Musk suggested that China’s recent crackdown on bitcoin and other cryptocurrencies was driven by the ruling Communist Party’s concern that the technology could undermine its power. 

“It would appear they don’t love crypto,” he said during an interview on stage at the Code Conference in Los Angeles on Tuesday. “I suppose crypto is fundamentally aimed at reducing power of centralized government and they don’t like that, is my guess.”

China’s central bank declared all cryptocurrency-related transactions illegal on Friday, and said foreign exchanges are banned from providing services to Chinese residents, in its strongest crackdown yet on the digital asset industry.

Musk has been a big fan of cryptocurrencies, including bitcoin and dogecoin, although his ardor has waned in recent months on concern about the environmental impact of mining these digital assets. 

The CEO revealed in February that Tesla invested $1.5 billion in bitcoin and said the carmaker would start accepting it as payment for vehicles. Barely three months later, Tesla made a U-turn and stopped payment in bitcoin because of how energy-intensive the mining process is.

On Tuesday, Musk was asked what government regulators should do in response to the spread of cryptocurrencies. “I’d say do nothing. Just let it fly,” he responded. “There’s some value in crypto, but I dont think it’s the second coming of the messiah. It will hopefully reduce the error and latency in legacy money systems.”

Musk also co-founded rocket company SpaceX, which completed the first all-tourist flight to orbit the earth earlier this month. He and Amazon founder Jeff Bezos are in a competitive space race, with the two billionaires jousting on social media and through regulators and other legal avenues. 

Blue Origin, Bezos’s rocket company, has filed a flurry of complaints to the FCC about SpaceX’s Starlink satellite-internet network and other matters. Musk has mocked Bezos for these legal moves, and he continued that line of attack on Tuesday. 

“He should put more energy into getting to orbit than lawsuits. You can’t sue your way to the moon no matter how good your lawyers are,” he said. 

Musk was also asked about the shape of the Blue Origin rocket, which has phallic overtones: “It could be different shape potentially” he said. “If you’re only going suboribital your rocket can be shorter,” he added, prompting laughs from the audience.  

Jeff Bezos space flight on Blue Origin rocket.

Blue Origin’s New Shepard rocket takes off on July 20, 2021 with Jeff Bezos on board.

Tony Gutierrez/AP

Musk announced a highly anticipated software update for Tesla vehicles on Saturday that lets drivers view daily “safety scores.” The company’s Full Self-Driving (FSD) software has been criticized by regulators. Jennifer Homendy, head of the National Transportation Safety Board, called the technology  “irresponsible,” and said the update was premature in a Wall Street Journal report.

FSD is an enhanced version of Autopilot, a driver-assistance software that comes with every Tesla vehicle. FSD doesn’t make the car fully autonomous but does allow the vehicle to change lanes, park itself, and recognize traffic lights and stop signs.

The tech entrepreneur became the world’s richest person again this month, after Tesla shares rebounded from a slump earlier in the year. Musk also runs Neuralink, a startup that is researching computer-to-brain connectivity, and The Boring Co., which is tunneling under various cities.

His personal life took another turn this month, too. The Tesla boss and Grimes, the singer and producer, ended their relationship after three years.  “It’s mostly that my work at SpaceX and Tesla requires me to be primarily in Texas or traveling overseas and her work is primarily in LA,” Musk said earlier this month. 

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