Elon Musk, CEO of Tesla and founder of SpaceX, appears to be reconsidering the possibility of using Bitcoin (BTC) as a currency on Mars.
Initially skeptical due to Bitcoin’s long transaction settlement times, Musk has suggested an innovative solution during a discussion with Cathie Wood, CEO of ARK Invest.
Musk had ruled out the idea of using Bitcoin on Mars due to the lengthy reconciliation process.
However, during a brainstorming session, the visionary entrepreneur suggested that, given the distances in terms of light minutes between Earth and Mars, the use of Bitcoin could be feasible.
Elon answers what money he would use on Mars: pic.twitter.com/VJQeIM0qqJ
— Sam Callahan (@samcallah) January 11, 2024
Although he acknowledges that it would be a challenge, he raises the possibility of establishing a localized network on the red planet to address these challenges.
One of the main obstacles identified by Musk is the slow speed of Bitcoin transactions.
Currently, transaction confirmation time can extend up to an hour due to the 10-minute block assembly and the need for six confirmations.
Musk proposed the implementation of a Lightning Network for Bitcoin located on Mars to speed up the process
Matt Corallo, lead developer of Bitcoin, supported Musk’s idea by pointing out that Bitcoin’s slow transaction speed could be effectively addressed by a localized Lightning Network.
On the other hand, Adam Back, CEO of Blockstream, showed even greater optimism by stating that with 10-minute blocks, distances of 12-22 light minutes between Earth and Mars would not pose a significant problem.
In April 2023, data from Glassnode highlighted the cost efficiency of Bitcoin’s Lightning Network.
With a transaction cost of 0.0029%, this network turns out to be approximately 1,000 times cheaper than traditional payment processors such as Mastercard or Visa.
Speculation also surrounds the possible integration of cryptocurrencies into Musk’s X platform, which he aims to turn into an “all-in-one app.”
Although reports in January 2023 suggested that X’s payments feature could support cryptocurrencies in the future, Musk, in August 2023, stated that he would “never” launch a crypto token on the platform.
Musk’s reconsideration of Bitcoin’s use on Mars and his proposals to address transaction speed offer a fascinating insight into the challenges and potential solutions on the journey toward Mars colonization.
Although the use of cryptocurrencies on Musk’s X platform remains speculative, his clear position on not creating a crypto token suggests a cautious approach towards new implementations in this space.