From DOGE to Bitcoin: How Fiat Accidentally 'Orange-Pilled' Elon Musk

Elon Musk, known for his role at Tesla and SpaceX, has shifted his views on Bitcoin, influenced by his previous attempts to tackle inefficiencies in U.S. government spending. His latest comments suggest a newfound appreciation for Bitcoin's relationship with energy and its potential to replace fiat currency.

Key Takeaways

Elon Musk’s views on Bitcoin have evolved due to his experiences with government spending.
He believes that Bitcoin is intrinsically linked to physical energy, presenting it as a potential alternative to fiat money.
The perception of Bitcoin’s environmental impact is changing, with reassessments of its energy consumption gaining traction in policy discussions.

From DOGE to Bitcoin: How fiat accidentally 'orange-pilled' Elon Musk

Musk's Evolving Perspective on Bitcoin

Elon Musk's efforts aimed at minimizing inefficiencies and excess spending within the U.S. federal government may not have been successful, but they seem to have sparked a significant transformation in his attitude toward Bitcoin. So, what has led to Musk discussing Bitcoin's intrinsic connections to physics and energy?

As noted by observer @DSBatten, Musk has firsthand experience in trying to combat excess government expenditure with the Dogecoin (DOGE) initiative. "He's tried to tackle that issue, only to find it impossible," said Batten.

Recently, Musk made headlines after he suggested that Bitcoin could potentially replace traditional fiat money because of its deep-rooted relationship with physical energy. In a conversation with Indian entrepreneur Nikhil Kamath, he stated, "You can't legislate energy. You can't just enact a law and suddenly generate more energy. It's challenging to create energy or effectively leverage it for meaningful work."

This statement quickly circulated on social media, particularly among Bitcoin supporters and industry experts. It marks one of Musk's first public comments on Bitcoin in years, as he indicated that society might shift away from the current fiat-based monetary system. "We probably won't have money. We'll just rely on power generation as the default currency," he remarked.

Dogecoin's Shortcomings Led Musk Back to Bitcoin

Daniel Batten, a Bitcoin advocacy figure, shared insights during Cointelegraph’s Chain Reaction show, where he discussed how Musk's previous attempts to support the Trump administration in curtailing excessive government spending have altered his perception of the financial ecosystem.

Batten noted, "Elon’s journey has evolved. He initially believed it was feasible to control government spending within a fiat-dominated system, but he had to run that experiment with DOGE, which ultimately did not succeed."

He explained that Musk's endeavors with the Department of Government Efficiency (DOGE) highlighted the limitations of fiat monetary policies and expanded his understanding of these constraints. Given Musk's background in physics, Batten suggests that he has come to appreciate energy-backed monetary systems as resistant to inflation. "Energy isn't something that can be printed into existence; it's a better foundation for sound money," he explained. "Consequently, he's increasingly recognizing that Bitcoin might be the answer."

Changing Perceptions of Bitcoin Mining

Batten also addressed the shifting views concerning the environmental implications of Bitcoin mining. Throughout the 2010s, mainstream media often portrayed Bitcoin's energy consumption as harmful to the planet. However, numerous academic studies and reports, including Cambridge's 2024 Digital Mining Industry Report, have debunked these narratives.

He pointed out that European policymakers have been especially affected by years of misleading reports about Bitcoin's environmental impact. Batten emphasized that Bitcoin's energy consumption arises during the mining process, not from individual transactions. He described this distinction as "crucial to understand," since the network can theoretically process countless more transactions without increasing energy usage.

"When focusing on a per-transaction metric, it implies an insidious notion: that it is unscalable. As you scale, energy consumption is expected to increase as well, a belief held by many European regulators today," Batten stated.

For a deeper exploration of Bitcoin mining, be sure to check out Cointelegraph’s comprehensive 2025 Bitcoin mining special.