What Happened: “I would say, ‘Do nothing,’” Musk said at the Code Conference in California on Tuesday when asked by interviewer Kara Swisher what approach the U.S. government should take on regulating cryptocurrencies.
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Musk added he believes it is possible for governments to slow down the advancement of cryptocurrencies but not destroy the sector
The Tesla CEO speculated that China’s regulatory crackdown on cryptocurrencies could be partly due to the electricity shortages in many parts of the country.
“Power demand is higher than expected, so crypto mining might be playing a role in that, I’m not sure,” Musk said.
Why It Matters: Musk’s comments assume significance as the U.S. government looks at regulating the cryptocurrency sector.
The U.S. Securities and Exchange Commission chairman Gary Gensler has said the regulator is working to create new rules to protect investors in the volatile crypto market and that tokens listed on crypto trading platforms should be treated as securities.
Musk is a big supporter of Bitcoin (CRYPTO: BTC) as well as Dogecoin and frequently tweets about cryptocurrencies, especially the latter. The tech tycoon has been a major catalyst for Dogecoin’s rise to prominence this year.
Price Action: Bitcoin is down 0.9% during the last 24 hours, trading at $42,282.01 at press time, while Dogecoin is down almost 0.8% during the 24-hour period to $0.2002.