Elon Musk: Tesla holding Bitcoin is ‘less dumb’ than holding cash

Tech mogul and the world’s richest person Elon Musk said that holding Bitcoin (BTC) is smarter than holding fiat currency. But only just.

In a tweet sent on Jan. 19, Musk called Bitcoin “a less dumb form of liquidity than cash.” He then argued that the Federal Reserve’s monetary policy is behind his opinion. “To be clear, I am *not* an investor, I am an engineer,” he wrote. “I don’t even own any publicly traded stock besides Tesla. However, when fiat currency has negative real interest, only a fool wouldn’t look elsewhere.” He added:

Bitcoin is almost as bs as fiat money. The key word is ‘almost.’”

Musk was defending the recent $1.5 billion Bitcoin investment of his electric car manufacturing firm Tesla, which he said “is adventurous enough for an S&P500 company.” 

Furthermore, he added that “Tesla’s action is not directly reflective” of his opinion. On a side note, his Twitter profile image is an anime character wearing a shirt with a bitcoin logo printed on it with a second, bigger, Bitcoin logo on the background behind her.

Despite his opinion, Musk has had a great impact on Bitcoin’s fortune recently, beginning on Jan. 29, When he changed his Twitter profile—which has 47.3 million followers—to a single word: #bitcoin

Shortly thereafter, he tweeted: “In retrospect, it was inevitable.” The price of Bitcoin jumped 17% in one hour. And, he’s had if anything a greater impact on the fortune’s of DogeCoin.

While his Midas touch isn’t infallible, it has parts of the crypto community worried. On Feb. 3, Bitcoin Research Lab came out with a paper looking at a half dozen incidents in which Musk moved crypto, concluding: 

“If a single tweet can potentially lead to an increase of $111 billion in Bitcoin’s market capitalization, a different tweet could also wipe out a similar value.”