07/28 update below. This post was originally published on July 26
Bitcoin and crypto prices have traded sideways for most of this year, with traders nervously braced for a dramatic shock.
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The bitcoin price fell to under $65,000 per bitcoin in February and remains stuck in a downward trend even as the chief executive of Goldman Sachs reveals he’s suddenly backing bitcoin’s “ultimate catalyst.”
Now, as bitcoin hurtles toward a $27.9 trillion game-changer, SpaceX and Tesla billionaire Elon Musk has predicted money “won’t matter” in as little as 10 years—something that could have profound implications for the bitcoin price.
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SpaceX and Tesla chief executive Elon Musk has predicted money “won’t matter” in as little as 10 years—something that could have profound implications for the bitcoin price.
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“Money won’t matter in 2036,” Musk told The Economist editor-in-chief, Zanny Minton Beddoes, in a wide-ranging interview, predicting that within ten years the world will transition to having “incredible abundance.”
“What do you want money for,” Musk, who became the world’s first trillionaire on June 12 when SpaceX went public but has since seen his fortune fall to around $700 billion, asked, pointing to his prediction that a massive proliferation of robots will render all money effectively worthless as people have their needs effortlessly met.
“You you want money for goods and services, right? You want money for obviously food, housing, transport, entertainment,” Musk said. “If that is so abundant that there’s more that the robots and AI are providing more goods and services than you than any human could possibly consume.”
07/28 update: After months of delays, Elon Musk has unveiled his long-awaited X Money, the financial element of his plan to turn X into an “everything app” that rivals China’s WeChat.
“This is money,” Musk posted to X, just days after predicting that in as little as ten years, money will no longer matter.
Musk shared an X Money post that said the X Money service would begin rolling out to X’s “U.S. Premium and Premium+ subscribers starting today,” calling it, “your money, on the world’s most powerful network.”
X Money will offer users interest rates of up to 6%, far higher than a U.S. average savings account rate of under 1% and around 4% for limited access, high-yield accounts.
“X Money is so epic, I use daily now,” Nick Shirley, a YouTuber and influencer known for his political videos and allegations of fraud at Somali-run child care centers in Minnesota, posted in response to Musk.
While Musk has yet to confirm any bitcoin or crypto features for X Money, the launch crystallises fears that have gripped Wall Street in recent years—that the world’s biggest technology companies are about to make a bid for the deposits held with banks, undermining the financial system’s ability to lend money based on the customer funds the banks hold.
Banking groups and Wall Street giants have united around their opposition to the crypto market structure bill known as the Clarity Act, which would see technology and crypto companies allowed to offer interest-like yield on cryptocurrencies known as stablecoins that are pegged to the U.S. dollar.
JPMorgan chief executive Jamie Dimon has been one of the loudest critics of the bill, warning it would put traditional banks at a competitive disadvantage by allowing crypto companies to offer yield-bearing stablecoin products that resemble bank deposits without being subject to the same regulatory framework.
Last year, the bipartisan Genius Act stablecoin bill laid the groundwork for the Clarity Act, banning fully-fledged interest payments on deposits while leaving the door open for “rewards” to be paid on active, transaction-based usage.
Musk has previously declared energy “the true currency,” fueling speculation among bitcoin supporters that he’s quietly backing the cryptocurrency while his two biggest companies, SpaceX and Tesla, hold major bitcoin reserves, 18,712 bitcoin and 11,509 bitcoin, respectively.
“Energy is the true currency,” Musk posted to X, responding to the pseudonymous beffjezos X account, who had posted: “If you understand money as a proxy for expected free energy, AI is literally an infinite money glitch.”
Combined SpaceX’s and Tesla’s bitcoin are worth almost $2 billion at the current bitcoin price of around $65,000.
In October, Musk posted to X that “bitcoin is based on energy: you can issue fake fiat currency, and every government in history has done so, but it is impossible to fake energy,” and agreeing that the “global arms race” toward artificial intelligence is the reason why gold, silver and bitcoin have all seen their prices soar in recent years.
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The bitcoin price has fallen sharply since October, though some think the bitcoin price bottom is in and that the bitcoin price will rally from here.
Forbes Digital Assets
Bitcoin, which is secured by a network of so-called miners who use powerful computers to validate transactions in return for newly issued bitcoin, uses as much electricity each year as some small countries, with its energy demands climbing along with its price as more miners join the network.
Musk’s support for bitcoin and crypto has waned from its Covid-era peak, though Musk has continued to give backing to bitcoin, as well as his “favorite” cryptocurrency dogecoin.
Following his White House exit, Musk said his America Party would favor bitcoin over the U.S. dollar, with Musk branding the dollar and other government-issued, debt-based currencies as “hopeless.”
