Once upon a time, Elon Musk was deeply concerned about climate change. This worry drove many of his business decisions and personal actions. He revitalized the electric vehicle industry after taking over Tesla Motors in 2004 and even joined President Donald Trump’s first business advisory council in 2017. He resigned from the council in protest when Trump withdrew the United States from the Paris Agreement. In 2021, Musk directed Tesla to invest heavily in Bitcoin, but he quickly reversed course upon realizing the cryptocurrency’s heavy reliance on energy-intensive mining processes.
It’s a stark contrast, then, to see Musk embracing Trump more closely than ever. The re-elected president is now surrounding himself with oil-industry figures and crypto insiders. These crypto insiders, with their energy-hungry mining rigs and data centers, naturally align with the fossil fuel industry’s expansionist goals. This shift appears to be part of a broader trend where Musk’s focus has drifted from his initial environmental concerns to other fields.
This shift has led to Musk re-embracing Bitcoin. Incorporating Bitcoin into Tesla’s accounting has artificially boosted the company’s profit reports. However, the core issue remains: Bitcoin mining is incredibly harmful to the environment, primarily due to its “proof of work” system. This system relies on high-efficiency chips, which is used to solve cryptographic puzzles required to unlock new Bitcoins. Replicating this operation requires numerous data centers packed with GPUs, which produce significant noise and need substantial amounts of water to cool, contributing to resource depletion.
A 2024 study found that U.S. Bitcoin miners alone consume as much water annually as 300,000 U.S. households. A single Bitcoin transaction can use enough water to fill a swimming pool. Much of the power used to run these operations comes from fossil fuels.
Even Republican lawmakers in crypto-friendly states, like Arkansas, have tried to regulate the industry’s pollution. However, Trump’s ill-advised plan to ensure all Bitcoin is mined within U.S. borders may undermine these efforts.
The vision for a Trump 2.0 presidency was outlined in writings by Musk’s tech-focused friends at Andreessen Horowitz, a venture capital firm and crypto funder. The firm’s leaders have become enthusiastic Trump supporters and advisors. Marc Andreessen’s “Techno-Optimist Manifesto” championed energy “abundance” over reducing fossil fuel use; Ben Horowitz’s blog supported any political candidate who believed crypto would create a fairer economy. With Andreessen advising Trump throughout the transition, the new administration is implementing the Andreessen Horowitz blueprint. The Securities and Exchange Commission, now more crypto-friendly, has also scrapped a requirement for companies to disclose their emissions in detail. Trump has also withdrawn the U.S. from the Paris Agreement again, and Musk has not objected.
Trump’s Department of Governmental Efficiency is targeting the National Oceanic and Atmospheric Administration and the Environmental Protection Agency for data purges, grant freezes, and mass firings. It’s not a coincidence that Musk is doing this under the umbrella of a fake “department” named for the Dogecoin cryptocurrency. The focus is on expanding nuclear power, a preference of Andreessen and Horowitz.
Purges of data from NOAA and EPA are troubling because of the censorship of key resources for tracking American energy consumption and emissions. These are crucial for independent researchers surveying how America utilizes electricity, both clean and dirty. Notable resources like Digiconomist, which tracks Bitcoin mining’s environmental impact, may be affected. This data affects the pricing and regulation of agricultural commodities, which could lead to legislative oversight led by agriculture-focused members of Congress.
Digital-asset advocates often criticize climate critiques that emerged during the crypto bubble. While some crypto ventures adopted less energy-intensive methods, Bitcoin users are dedicated to taking an all-the-time approach. They don’t want the government to scrutinize their electricity needs. Banks and other firms may be less likely to express skepticism over cryptocurrency’s actual value.
Trump himself has become increasingly involved, from meme currencies to a coin-hoarding private venture, and establishing a crypto arm for his Truth Social network. It is a way to ensure regulatory capture. If the consequence is a hotter, less-habitable Earth, then so be it. They will have their digital riches to isolate themselves from the real-world consequences of these decisions.
Crypto proponents often tout it as the solution to financial, political, and cultural woes. However, given the environmental impact, there might not be a habitable future to spend the digital wealth in.
