Elon Musk's Advice To US Governments Trying To Regulate Crypto: Don't Do It!

Elon Musk advised the US government not to regulate the crypto market. (photo; doc. between)

JAKARTA - Tesla CEO Elon Musk on Tuesday, September 28 said the US government should avoid its attempts to regulate the crypto market.

“In my opinion, it is impossible to destroy crypto, but it is possible for governments to slow its progress,” Musk said at the Code Conference in Beverly Hills, California.

Musk was on stage responding to a THAT question from New York Times columnist Kara Swisher. He asked if the US government should get involved in regulating the crypto space.

"I would say, 'Don't do anything,'" he said.

Tesla said earlier this year that it had bought $1.5 billion worth of bitcoins. The value of those holdings swelled to around $2.5 billion in the second quarter as bitcoin prices soared. Bitcoin has since gone down, along with other cryptocurrencies.

Musk, who frequently touts his support for various digital coins on Twitter, is very optimistic about the role crypto has in potentially reducing “error and latency” in legacy money systems. But he admits that crypto doesn't have all the answers to society's ills.

“I wouldn't say I'm a big cryptocurrency expert,” Musk said. “I think there is some value in cryptocurrencies, but I would not say it is the second coming of the Messiah.”

Musk also discussed China's role in crypto mining and regulation. Last week, China's central bank outlined tougher measures in its broader crypto crackdown, including an improved system for monitoring crypto-related transactions.

Musk said it most likely had something to do with the country's "significant power generation problem".

"Part of it may actually be due to electricity shortages in many parts of China," Musk said. “Many areas of Southern China are currently experiencing random power outages, as electricity demand is higher than expected. Crypto mining might play a role in that,” he said.

At a higher level, the decentralized nature of cryptocurrencies can present challenges for the Chinese government.

“I think cryptocurrencies are basically meant to reduce the power of centralized government,” Musk said. "They don't like that."