Elon Musk Warms Up to Ethereum (ETH) after Seeing Account Hijacked for Crypto Scams

By August 29, 2018Ethereum
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The founder of Tesla and SpaceX warms up to crypto assets, after his profile was faked for months for Ethereum giveaway scams.

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The billionaire CEO of SpaceX and Tesla, Elon Musk suggested he has warmed up to Ethereum (ETH) in a recent tweet:

The tweet was part of a discussion regarding the proliferation of fake Elon Musk accounts. Those accounts spread the Ethereum giveaway scam, in which users are promised a huge return, if they send a small amount of ETH to a wallet. The scam has affected prominent accounts in the crypto space, with Elon Musk’s Twitter also heavily affected. Recently, Twitter started a fight against scam bots by blocking anyone using Musk's name.

The tweet does not give details on whether Musk would actually do anything with Ethereum. Some analysts have suggested that Musk could use cryptocurrency to take Tesla private. Or make an initial coin offering (ICO) via the Ethereum network to raise funding for the initiative.

While there are niche attempts, such as linking the Tesla Ridershare platform with the EOS network,the electric car manufacturer has no direct plans of using blockchain technology, neither the Ethereum network.

The tweet arrives at a moment when the utility of the Ethereum network is questioned again. As ETH market prices fell below the $300 range, the usage of the coin to finance startups is also declining. The other flaw with Ethereum is the fact that the network is still easily overwhelmed by a single app, taking up gas and raising transaction prices across the board.

At the same time, most apps are used by only a handful of people, leading to multi-million dollar valuations for projects that only serve a few dozen users. And while standard transactions usually cost $0.013, some apps and smart contracts extract higher fees, while network congestion raises fees overall for all Ethereum users.

ETH presently trades at above $290, down from above $320 two weeks ago, and some see the slide as the effect of ICOs selling their ETH haul for operating purposes. In the past 30 days, ICOs converted thousands of ETH for cash, based on data from App.Santiment.net.

Ethereum-based ICOs have vastly different treasuries, depending on the time they raised their funds. ICOs that worked at peak ETH prices only managed to raise a handful of ETH, and have seen their stash depreciate by around 60% since the peak, as ETH wiped out value.

Neither the author nor the publication assumes any responsibility or liability for any investments, profits, or losses made as a result of this information. Cryptocurrency trading and investing are risky propositions, and market participants are advised to always conduct thorough research.

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