Elon Musk announced Tesla will suspend BTC payments due to environmental concerns. The total crypto market then shed some $350 billion.

TETHER TEASE: Tether, the company behind the same-named dollar-pegged stablecoin worth some $57 billion, revealed the breakdown of its reserves for the first time. As of March 31, USDT is backed by 75.85% cash and equivalents, 12.55% secured loans, 9.96% in corporate bonds and precious metals and 1.64% in other investments, including digital currencies.

But the numbers may not all be what they seem. For starters, the report, issued to fulfill an ongoing legal requirement with New York State, doesn’t appear to be independently audited. Second, the majority of tether’s “cash equivalents” are in unrated corporate debt.

DOGS RUGGED? Vitalik Buterin “rugged” several “dog tokens” yesterday and sent the proceeds to charity. The background: A number of dogecoin spin-offs had been trading on the Ethereum co-creator’s name, having sent a chunk of their supply to show they were “backed by Buterin,” a stunt that seemed to work… until it didn’t.

Shiba Inu coin, dogelon, Akita Inu, among other tokens, rapidly appreciated in price and clogged the Ethereum network, sending fees to record highs. Buterin regifted or liquidated the tokens to benefit GitHub, the India Covid Relief Fund and other charities.

‘LOCKED OUT’: Dozens of Binance.US users have been locked out of their accounts, often without clear justification or path to retrieve their funds, a CoinDesk investigation has found. Crypto exchanges frequently place temporary restrictions on trading – during periods of market volatility or an individual’s KYC process, for instance – though for some Binance customers the freeze can last months.

BLOCKS CHAINED? Bitcoin’s mining difficulty adjusted upwards 21.53% Thursday, making it more difficult than ever to mine. Microsoft will shut its Azure-based blockchain-as-a-service platform. Joseph Lubin is seeking to raise $75 million for a new blockchain venture fund. Finally, the Facebook-linked Diem Association is partnering with Silvergate Bank to pilot a dollar-pegged stablecoin. The group also withdrew its application for a Swiss Financial Markets Authority license, representing a complete capitulation on the original “libra” design.

WATCHFUL EYES: The IRS could seize people’s crypto assets (treated as property, not currency, under current law) to settle unpaid taxes, an agency official said. South Korea’s central bank plans to monitor crypto transactions made through users’ bank accounts. Finally, the Reserve Bank of India has been unofficially encouraging banks to cut ties with crypto businesses.

–Daniel Kuhn

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A message from Lisk

Lisk.js 2021 is a free online event organized by Lisk, an open-source blockchain application platform. The two-day virtual event, open to all developers, blockchain enthusiasts and community members globally, will set the stage for the major reveal of Lisk's Interoperability solution. Developers can expect to learn how to develop a blockchain application with Lisk SDK in JavaScript, attend in-depth talks on blockchain interoperability, and get inspired by community members who have already built blockchain applications on Lisk.

The Musk Motivation
Bitcoin is once again in the middle of a conversation about climate change and marginal utility. On Wednesday evening, Elon Musk blew a hole through bitcoiners’ hearts when announcing his car company, Tesla, will pause BTC payments. His reason: The societal benefits of bitcoin “cannot come at great cost to the environment.”

The electric car manufacturer will hold on to its $2.5 billion BTC reserve and plans to resume accepting the orange coin if/when mining “transitions to more sustainable energy.”

There are many questions I, like many, have about this about-face. Did Tesla really not do due diligence on bitcoin’s coal-heavy provenance when moving into the market three months ago? Is the decision somehow tied to “renewable credits?” Can I sue?

Musk’s motivations are often impenetrable. But it’s clear this is just the latest front in a longstanding debate over whether bitcoin, a global monetary layer accessible to any and all, is worth the ecological price everyone pays.

The world’s second richest man is now somewhere in the middle of a messy continuum between those who think bitcoin is a useless drain on resources and those who might welcome razing the Amazon to build additional mining facilities.

He’s also a man with tremendous influence. On Feb. 8, the price of bitcoin jumped 14% after Tesla parked $1.5 billion in the asset. The Musk effect of a single DOGE meme often (though not always) leads to double-digit spikes. Yesterday, his tweets erased some $350 billion from the entire cryptocurrency market (it has since pared back some losses).

Taking Musk at his word, Mike Novogratz said the space-faring, erstwhile comedian has presented bitcoiners with an ultimatum to go green or go home. Musk may be using his influence to achieve what other bitcoin heavyweights – like Twitter's Jack Dorsey and Ark Invest's Cathie Woods – have long promised: using bitcoin to drive renewable energy innovation.

It’s an important goal. The bitcoin hashrate, a proxy for its energy consumption, has climbed to record highs during the recent bull run. Reuters reports mining consumers 66 times more electricity than in 2015.

Long the preserve of iconoclasts, cryptography nerds and free bankers, bitcoin this year moved into the financial mainstream. It’s no longer isolated from the larger political or social conversation. As long as people continue to like Earth and equality, bitcoin’s environmental and social “toxicity” will dominate headlines.

–D.K.