Will Tesla Resume Bitcoin Transactions Now That Miners Clean Energy Usage Exceeds 50% In China?

What Happened: Over the weekend, crypto markets rallied after Elon Musk tweeted that Tesla Inc TSLA would resume accepting Bitcoin BTC/USD for payments when clean energy usage by miners was confirmed to be over 50%.

“When there’s confirmation of reasonable (~50%) clean energy usage by miners with positive future trend, Tesla will resume allowing Bitcoin transactions,” said Musk on Twitter.

Jiang Zhuoer, CEO of Chinese Bitcoin mining pool BTC.TOP, responded to Musk’s tweet notifying him that the only operational mining farms in China at the moment are hydropower mining farms.

As a result, the clean energy usage by Bitcoin miners already exceeds 50%.

Now all the mining facilities in Xinjiang, Inner Mongolia and Qinghai provinces have been shut down, only hydropower mining farms in Sichuan are left. Currently the clean energy usage by #Bitcoin miners ⛏️already exceeds 50%. 😁 https://t.co/3jeFSXxy0R

— Jiang Zhuoer BTC.TOP (@JiangZhuoer) June 16, 2021

Why It Matters: After a crackdown on Bitcoin mining from the Chinese government, most mining facilities have already shut down in the region.

According to a report from CoinDesk, the Yunaan Energy Bureau recently announced plans to shut down all Bitcoin mining operations.

Yunaan became the third province to take a stance against coal-based Bitcoin mining, after the Qinghai province and the Xinjiang province earlier this month.

Read also: What is cryptocurrency mining?

These mass shutdowns of Chinese mining operations led to a drastic drop in hashrate from some of the top Bitcoin mining pools.

According to a report from Compass Mining, top pools like Antpool and F2 pool each lost over 30% of their hashrate, and China-based 1THash lost about 70% of its hash rate in just a week.

With existing Chinese mining facilities now using clean energy while leading North American Bitcoin miners moving towards cleaner mining practices and enhanced transparency with the establishment of the Bitcoin Mining Council, Musk’s “confirmation of clean energy usage” might come very soon.

“The big positive with Tesla accepting Bitcoin…again...is that it helps social proof it for other companies,” said crypto analyst Lark Davis.

Price Action: Bitcoin was trading at $37,791 at the time of writing, down 2.21% in the past 24-hours.