What If Elon Musk Is Just Making “Noob” Crypto Mistakes?

Is Elon Musk playing 4D chess or is he just making rookie mistakes? It’s easy to judge the unfortunate and inaccurate message those tweets contained, but, what if Elon simply doesn’t know better? What if the billionaire doesn’t have a master plan and instead is just learning right in front of our eyes? It’s certainly a possibility. At least that’s what TV personality and Bitcoin advocate Max Keiser thinks:

We should remember that Elon is a #Bitcoin noob making all the same noob mistakes.

— Max Keiser (@maxkeiser) May 26, 2021

Even though Mr. Musk has been around cryptocurrencies for a long time, he’s only been into cryptocurrencies for a few months. Luckily for us, our sister site Bitcoinist is on the case from the very beginning. Let’s examine Elon’s history with blockchain-technology-related projects and try to figure out his master plan or lack thereof. It’s the least we can do.

Could Elon Musk Be Satoshi Nakamoto?

Three years ago, the billionaire had to respond to the world:

“Not true. A friend sent me part of a BTC a few years (sic), but I don’t know where it is,” he wrote in response to a recent blog post whose author, Sahil Gupta, said Musk was “probably” Nakamoto.
“Satoshi could be a collaboration of Musk, Nick Szabo, and Hal Finney. But it seems more likely that Elon read their research papers, took inspiration from them, and built the product solo,” Gupta had mused.

Even though back then Musk had nothing to do with cryptocurrencies, he was in the same orbit. And the crypto community tried to pull him in using various tactics.

DOGE price chart on Bitfinex | Source: DOGE/USD on TradingView.com

The CEO Of Dogecoin

Two years ago, the Dogecoin community crowned him CEO. As you might imagine, the coin registered its first Elon-pump: 

The effect on Dogecoin was immediate and decisive: as of press time, the altcoin had made daily gains against the US dollar of almost 35 percent.

DOGE/USD currently trades around $0.0033, its highest since early November.

Elon Musk quickly gained the attention of the cryptocurrency community on Twitter, with traders extrapolating potential endorsement of the wider industry beyond DOGE.

And even though Musk immediately resigned to the Doge CEO position, the relationship between the billionaire and the joke-cryptocurrency would prove to be stronger than anyone thought.

Related Reading | Goldman Sachs Exec Says Much Nope To Firm After Making Millions On Dogecoin

Elon Musk’s Initial Views On Crypto

A year ago, the billionaire finally spoke publicly about cryptocurrencies in his own “Third Row Tesla Podcast”. Bitcoinist reported:

He likes the concept and thinks that it is ‘clever.’ However, he also has concerns regarding their role in making illegal transactions. He said,

There are transactions that are not within the balance of the law. And there are, obviously, many laws in different countries. And, normally, cash is used for these transactions. But, in order for illegal transactions to occur, cash must also be used for legal transactions. You need an illegal-to-legal bridge. That’s where crypto comes in.

Oh, the “criminals use Bitcoin” argument. The first question every noob encounters. We hope that Elon already figured out that every transaction made stays engraved in the blockchain forever. And that fact is not ideal for criminals, as the DarkSide saga proves.

Tesla Adds Bitcoin To Its Balance Sheet

A mere four months ago, Bitcoin got the Elon-pump. His company was in the process of acquiring BTC and:

Elon Musk’s addition of “#Bitcoin” to his Twitter bio and potential buying activities undoubtedly played a huge role in this rally.

The coin went from $32K to $38K, and then it was up-only for a while. A few months later, Elon answered “true” to a tweet about Bitcoin and renewable energy. Bitcoinist reported:

An April tweet that proves that Elon had been thinking about the subject. Not only that, he agreed with Jack Dorsey when he made this statement: “Bitcoin incentivizes renewable energy.” Talk about a smoking gun.

A few weeks later, Elon announced in an infamous tweet that Tesla wasn’t accepting more Bitcoin payments for environmental concerns. And all hell broke loose. 

BTC price chart on Gemini | Source: BTC/USD on TradingView.com

Maybe Elon Musk Has Not Done His Homework?

It’s hard to believe that Tesla invested more than a billion dollars in Bitcoin without researching the environmental part of the equation. But then again, while defending his position, Elon made clear that he doesn’t know the difference between the nodes and the miners:

Bitcoin is actually highly centralized, with supermajority controlled by handful of big mining (aka hashing) companies.

A single coal mine in Xinjiang flooded, almost killing miners, and Bitcoin hash rate dropped 35%. Sound “decentralized” to you?https://t.co/Oom8yzGRNQ

— Elon Musk (@elonmusk) May 16, 2021

While the fact that most miners were in China is not ideal, the nodes control the Bitcoin network. And those are spread all over the world. And anyone could start operating one by following a few easy steps, even you.

And then, just three weeks ago, he said the darndest thing about Dogecoin. Bitcoinist reported:

With his distinctive sense of humor, Musk finds it ironic that this nascent class, with the potential to be the world’s reserve currency, to be spearhead by a project that started as a joke. Musk said:

Which one it is going to be? Maybe it’ll be multiple, it should be considered speculation at this point. The point is that Dogecoin was invented as a joke, as essentially to make fun of cryptocurrencies. Fate loves irony, what it would be the most ironic outcome? That the currency that was invented as a joke, in fact becomes the real currency. To the moon!

That’s cute! Nevertheless, Doge fundamental characteristics make it an impossible outcome. The supply is unlimited and the system mints an absurd amount of new coins every day. If the world wants a perpetual-printing machine that devalues the holder’s coins by the minute, it already has the Fiat system.

And, mind you, the perpetual printing was the main part of the Doge joke. It seems that the punchline flew over Elon’s head.

Related Reading | Binance Burns Record $600 Million BNB In Its 15th Quarter

So, Could Elon Be Just Making Noob Mistakes? 

When a great mind accompanied by a big ego encounters Bitcoin, it immediately gravitates towards trying to fix it. Elon is not the first and will not be the last. Every great Bitcoin thinker out there had an Altcoin phase. They all thought that maybe a new idea had come along that made Bitcoin obsolete. 

Eventually, they all realize that Bitcoin is more of a miracle than a technology. That the economic incentives are right where they belong, and that it’s a machine with the potential of improving the world for everyone.

Maybe Max Keiser is right and Musk just isn’t there yet. 

If that’s what’s happening, we can probably count on his genius to figure all of this out.

Let’s hope he does it sooner than later.

Featured Image by Vitolda Klein on Unsplash - Charts by TradingView