Elon Musk, Technoking of Tesla, orders a halt to bitcoin car payments 

Tesla CEO and self-dubbed Technoking is back-peddling on the company’s stance about bitcoin and has suspended purchases of its electric vehicles with the cryptocurrency.

The change of stance, which was delivered via tweet, comes just weeks after Tesla CFO and dubbed “Master of Coin” Zach Kirkhorn said the company believes in the longevity of bitcoin, despite its volatility. The tweet from Musk sent the price of bitcoin down more than 4% (and falling). The price of bitcoin is down more than 7% for the day, although some of that decrease occurred prior to Musk’s tweet:

Tesla has suspended vehicle purchases using Bitcoin. We are concerned about rapidly increasing use of fossil fuels for Bitcoin mining and transactions, especially coal, which has the worst emissions of any fuel.

Cryptocurrency is a good idea on many levels and we believe it has a promising future, but this cannot come at a great cost to the environment.

Tesla will not be selling any Bitcoin and we intend to use it for transactions as soon as mining transitions to more sustainable energy. We are also looking at other cryptocurrencies that use <1% of Bitcoin’s energy/transaction.

Tesla invested $1.5 billion in bitcoin this quarter and then trimmed its position by 10%, Kirkhorn said during the company’s quarterly earnings call in April. That sale made a $101 million “positive impact” to the company’s profitability in the first quarter.

Kirkhorn said Tesla turned to bitcoin as a place to store cash and still access it immediately, all while providing a better return on investment than more traditional central bank-backed safe havens. Of course, the higher yields provided by the volatile digital currency comes with higher risk.

If you’re getting whiplash from this announcement, you’re not alone. Tesla originally announced in March that it would accept bitcoin as a form of payment in the United States. But Elon Musk, the Technoking of Tesla, is known for drastically affecting the crypto market with just a mere tweeting of his thumbs. Every time the man tweets an image of a Shiba Inu, the joke coin called Dogecoin sores in the stocks.

In anticipation for Musk’s appearance on Saturday Night Live, many anticipated that the coin would reach $1, but when the “Dogefather” admitted (as a joke) to the currency being a hustle, the price of the coin crashed 30%.

Energy sucker

When it first became public that Tesla had purchased $1.5 billion in Bitcoin, investors, analysts and money managers at some of the country’s largest banks noted that it presented risks for the company. Others noted it could damage its reputation.

Bitcoin functions using what is known as a “Proof of Work” consensus, which means the network relies on mining to continue operating. The bulk of bitcoin mining is conducted in Russia and China. Until the energy grid decarbonizes, as TechCrunch noted back in February, mining bitcoin will remain a dirty business, though plenty of mining operations today do use renewable energies, in part. One investor told TechCrunch that the cost per transaction from an energy intensity standpoint has only gotten more intense.

Musk hinted that other cryptocurrencies are on the table. Those will likely be ones that use “Proof of Stake” consensus mechanisms, which networks like Ethereum have committed to transition to due to their energy efficiencies.

Vitalik Buterin donates $1 billion worth of ‘meme coins’ to India COVID Relief Fund

Vitalik Buterin, the creator of Ethereum, on Wednesday donated Ethereum and “meme coins” worth $1.5 billion in one of the largest-ever individual philanthropy efforts.

Buterin transferred 500 ETH and over 50 trillion SHIB (Shiba Inu), a meme coin, worth around $1.14 billion at the time of transaction, to the India COVID-Crypto Relief Fund. The transaction sparked panic among some investors, contributing to over 35% drop in SHIB’s price in the past 24 hours.

The meme coin, which has courted retail investors in China and elsewhere following recent surges in the Dogecoin cryptocurrency, managed to garner billions (USD) worth of investment in recent days before today’s crash.

Buterin’s offloading of several dog-themed meme coins — which were sent to him without his consent in the first place — comes at a time when India is grappling with a surge in the coronavirus infections.

Sandeep Nailwal, who put together the Indian relief fund and co-founded crypto organization Polygon, said in a tweet that he won’t do anything that hurts “any community specially the retail community involved with SHIB.”

Buterin, who became the youngest crypto billionaire at the age of 27 earlier this month, also transferred Ethereum and Dogelon Mars (ELON) — another meme coin — worth $336 million to Methuselah Foundation, a nonprofit that supports efforts in tissue engineering and regenerative medicine therapies; and over 13,000 ETH to Givewell, a nonprofit organization that works to curate the best charities around the world. Buterin also donated to Gitcoin Community, MIRI and Charter Cities Institute.

India has been reporting over 350,000 daily infections and over 3,500 fatalities for the last two weeks. The second wave of the coronavirus has overwhelmed the South Asian nation’s healthcare system, leaving countless people to scramble for hospital beds, medical oxygen and other supplies.

A number of entrepreneurs including Balaji Srinivasan have donated to the India Crypto Relief Fund, which maintains a log of all the donations. Buterin himself had donated about $600,000 in ether and maker tokens to the fund last month.

Scores of startup founders, investors and technology giants have stepped up to help India navigate the pandemic in recent weeks.

With backers like Tiger Global, LatAm crypto exchange Bisto raises $250M at a $2.2B valuation

Bitso, a regulated crypto exchange in Latin America, announced today it has raised $250 million in a Series C round of funding that values the company at $2.2 billion.

Tiger Global and Coatue co-led the round, which also included participation from Paradigm, BOND & Valor Capital Group and existing backers QED, Pantera Capital and Kaszek.

The news caught our attention for several reasons. For one, it comes just four months after the Brazilian startup raised $62 million in a Series B round. Secondly, the company believes the funding makes it the most valuable crypto platform in Latin America. And lastly, it also makes the company one of the most highly valued fintechs in the region.

Last year was a good one for Bitso, which says it processed more than $1.2 billion in international payments — including remittances and payments between companies — during 2020 alone. Bitso says it also has surpassed 2 million users. These two milestones, the company argues, is evidence of the growing use of crypto as an everyday financial tool in the region.

Demand for crypto assets and crypto-enabled financial products have soared in popularity both for individuals and businesses in the region, according to Bitso, which aims to be “the safest, most transparent, and only regulatory compliant platform” in Latin America. The company also says it’s the only player in the region to offer crypto-insurance for its client’s funds.

“The growth of the crypto ecosystem this year has been remarkable. It took Bitso six years to get its first million clients. Now — less than 10 months later — we have reached the 2 million mark,” said Bitso co-founder and CEO Daniel Vogel. But the metrics he is most proud of are that Bitso has also more than doubled the assets on its platform in the last five months and that its transacting volume during the 2021 first quarter exceeded the transaction volume it did in all of 2020.

Bitso was founded in January 2014 and acquired its first customer in April of that year.

Bitso’s mission, put simply, is to build next-generation borderless financial services for consumers and businesses alike. “Cryptocurrencies are the future of finance and Bitso makes the future available today,” the company says.

“Bitso offers products and services for individuals and businesses to use crypto in their everyday life,” Vogel said. “In some parts of the world, crypto is associated with speculation. Bitso’s customers rely on the technology for everyday uses from receiving remittances to engaging in international commerce.”

Image Credits: Bisto

Bitso says its “global-minded” product offerings fit the needs of local customers in Mexico, Argentina and now Brazil, where it just launched its retail operations. The company plans to use its new capital toward broadening its capabilities and product offering. It also plans to expand its operations in other Latin American countries in the coming months. In January, the Financial Superintendence of Colombia announced Bitso as one of the authorized companies in its Sandbox and crypto pilot program.

Bitso’s upcoming products include a crypto derivatives platform and interest bearing accounts for crypto.

“This is a pivotal moment for the future of finance in Latin America,” Vogel told TechCrunch. “We see a significant amount of traditional financial infrastructure in the region being replaced by crypto. We plan to use this funding to continue that trend by expanding our product offering for individuals and businesses.”

Naturally, Bitso’s investors are bullish on the company’s potential.

QED Investors co-founder and managing partner Nigel Morris admits that in the past he was “a crypto denier.”

“For the longest time, we didn’t see a way crypto fit. It wasn’t clear until recently that the use cases for crypto expanded much beyond speculative trading. There are now a whole series of conventional banking products that we can wrap around it,” Morris told TechCrunch.

Bitso’s mission, he said, is to “make crypto useful” and QED believes the company is succeeding at doing just that.

“Daniel and the entire Bitso team is passionate about taking the mystique out of crypto. Crypto is not going away; it’s going to be here for the future,” Morris said. “By sitting at the intersection of crypto and traditional financial institutions, Bitso has a promise to provide lower-cost, friction-free financial services to entire populations of individuals who otherwise would be excluded — a laudable and unique mission indeed.”

Bitso, he added, is learning from the crypto experience in the U.S. and around the world.

“Not making the same mistakes and leaning into the emerging regulatory landscape has been a competitive advantage to Bitso’s success in Mexico,” Morris said. “As Bitso grows throughout the regions, they certainly have a leg up and might even leapfrog crypto adoption in the U.S.”

“Crypto is rapidly gaining adoption in Latin America,” said Tiger Global Partner Scott Shleifer, in a written statement. “We are excited to partner with Bitso and believe they have the right team and platform to increase share in this growing market.”

Founded in 2014, Bitso has more than 300 employees across 25 different countries. That compares to 116 employees last year at this time. In particular, its growth in Brazil is increasing exponentially.

“We’ve gone from 1 to 26 Bitsonauts already based in Brazil, with many more working from abroad, and plan to 3X our number of hires in Brazil by the end of the year,” Vogel said, who acknowledged that the pandemic really impacted his company via the shift to remote work. “As we expand our reach into new territories, it has become a lot easier to meet staffing needs when the requirements are based on knowledge over geography.”

Bitso’s leadership is mostly based in Mexico, but the company also has offices in Buenos Aires, São Paolo and Gibraltar.