From Twitter trolling to Tesla mining, the complicated relationship between Iron Man Musk and Bitcoin

Last week, Tesla CEO Elon Musk said Bitcoin’s architecture is “pretty amazing” and said the digital currency is a “better way to transfer value than paper money.”

This is perhaps Musk’s most direct comment on cryptocurrency and blockchain so far, as he usually tries to avoid mentioning the topic. Prior to this, the technology tycoon had several “confrontations” with cryptocurrency - after all, Musk founded PayPal earlier, and he couldn’t ignore any innovative digital payment methods.

Musk has been associated with cryptocurrencies since 2014, when he first made public comments about Bitcoin.

October 2014: Musk says illegal transactions will be the main battlefield for Bitcoin

In October 2014, Musk was asked in a public interview whether he thought Bitcoin could subvert legal currency. He replied:

I think Bitcoin could be a good thing. It may have started out as a tool for illegal transactions. But that's not necessarily entirely negative. Some things shouldn't be illegal.

He added:

Bitcoin should be usable for both legal and illegal transactions, otherwise it has no value in illegal transactions because a connection needs to be established between the legal and illegal.

At the time, he said he had no Bitcoin.

November 2017: Musk clarifies that he is not Satoshi Nakamoto, but holds some Bitcoin

In November 2017, Sahil Gupta, an intern at SpaceX, broke the news to the media, saying that he speculated that Musk was Satoshi Nakamoto, the creator of Bitcoin.

Combining Musk's economics background and his abilities in software and innovation, Gupta speculates that Musk created Bitcoin.

Musk later denied the claim, tweeting that Gupta's statement was "not true." However, he revealed that he holds "some Bitcoin" that his friend transferred to him a few years ago.

December 2017: Musk says he's never heard of Bitcoin

In December, Neeraj K. Agrawal of the cryptocurrency research organization CoinCenter asked Musk on Twitter whether he created Bitcoin, and Musk replied that he had "never heard of it" and posted a link to an article titled "Bitcoin's plunge indicates that the crazy and virtual Internet currency has flaws."

January 2018: Musk, cryptocurrencies, and flamethrowers

Musk began to use the cryptocurrency craze to promote his company’s flamethrower in January last year, when altcoins experienced a surge after bitcoin hit a new high.

The flamethrower is sentient, its activation code is 'cryptocurrency', and it comes with a free blockchain.

February 2018: Musk comments on Twitter about cryptocurrency fraud, reveals Bitcoin holdings

Last year, cryptocurrency scams were rampant on Twitter. Scammers would usually apply for a fake account of a celebrity to deceive users and defraud them of their cryptocurrency.

A netizen asked on Twitter why this type of scam is so common? Musk replied that he has contacted Twitter CEO Jack Dorsey and hopes to solve this problem as soon as possible. He also revealed:

I don’t hold any cryptocurrency other than 0.25 BTC a friend sent me many years ago.

At the time, the bitcoin he held was worth $2,531, but today it might be worth less than $1,000.

Interestingly, just a few days before this tweet was published, Tesla's AWS (Amazon Web Services) software was hijacked. The attacker obtained Tesla's AWS access credentials through a Kubernetes software without a password, and then used this software to mine Bitcoin for an unknown period of time. The attack was prepared, and the attacker even set up his own mining pool software, and then connected the malicious script to an "unqueued" endpoint to keep the CPU usage low to avoid detection.

In December 2017, another Tesla owner placed a mining machine in the trunk and used the car charger to mine Bitcoin.

March 2018: Musk is spotted holding a book about cryptocurrency

Last March, a photo of Musk holding a book titled "Cryptocurrency Explained Simply" circulated online. The photo was taken at a music festival, when the audience asked him to sign the book. However, according to the author of the book, Julian Hosp, Musk eventually accepted the book.

October 2018: Musk joked about selling Bitcoin and was banned from Twitter

On October 22, Musk tweeted "Want to buy Bitcoin?" and posted a photo from the Cryptocurrency Girls website, which draws major cryptocurrencies as anime characters.

Musk later confirmed that it was just a prank.

I was just kidding. Bitcoin and Ethereum scams are rampant on Twitter and I decided to join them so I tweeted this.

Musk's account was also temporarily frozen, and the reason given by Twitter was "violating the rules prohibiting the sale of Bitcoin and other items."

November 2018: Hackers stole $157,000 worth of cryptocurrency after compromising influencer accounts

According to British media reports, hackers stole 120,000 euros (about 157,000 US dollars) by impersonating celebrities such as Musk on Twitter to promote fake cryptocurrency airdrops.

These hackers hacked into verified celebrity accounts and posted tweets offering to give away cryptocurrency, deceiving netizens into sending small amounts of Bitcoin to fixed addresses in exchange for higher returns. According to reports, there are more than 300 victims.

February 2019: Musk says Bitcoin's architecture is amazing and Ethereum also has advantages

Last month, Musk made his first explicit comments about cryptocurrency on a podcast, his most serious comments on the topic since 2014. When the host asked Musk to talk about cryptocurrency, he laughed, "Cryptocurrency? Really?"

Despite this, he made his position clear. The host asked him if he thought Bitcoin could become the only native cryptocurrency of the Internet. He replied:

I think the architecture of Bitcoin is pretty amazing, and it seems like Ethereum has some merits as well, and probably other currencies as well.

Musk then stressed that it would be “unwise to use Tesla’s resources to get involved in cryptocurrency-related businesses” because his company is “trying to achieve rapid development of sustainable energy.” As such, he pointed out that cryptocurrency’s high energy consumption is one of its drawbacks:

One of the downsides of cryptocurrencies is that they are computationally very energy intensive. Therefore, the output of cryptocurrencies should be limited. Creating incremental Bitcoins is very energy intensive.

As for the pros, Musk noted that he is optimistic about cryptocurrencies’ ability to transfer value and circumvent currency controls:

It can circumvent currency controls. Paper money is disappearing, and cryptocurrencies are a better way to transfer value than paper money. That much is certain.