Ark Invest, File (for Wood) and Hannibal Hanschke/Pool Photo via AP, File (for Musk).
- Elon Musk's abrupt reversal on bitcoin conflicts with Cathie Wood's Ark Invest, which said bitcoin mining is environmentally positive.
- Musk on Wednesday evening announced he is suspending the purchase of Tesla vehicles using bitcoin, citing environmental concerns.
- Three out of six of Wood's ETFs count Tesla as their top holding.
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Elon Musk's abrupt reversal on bitcoin Wednesday evening conflicts not only with his previous stance by holding bitcoin himself and investing for Tesla but also with research from Cathie Wood's Ark Invest.
The star stock picker's firm in April argued that mining bitcoin is actually environmentally beneficial.
Mining cryptocurrencies, bitcoin included, can increase the overall share of renewable energy provision to the grid, according to an April post from Ark research director Brett Winton and co-authors Yassine Elmandjra and Sam Korus, as first reported by Bloomberg.
"Bitcoin mining could encourage investment in solar energy systems, enabling renewables to generate a higher percentage of grid power with no change in the cost of electricity," the authors said in the post.
Without bitcoin mining, they added, "solar could supply only 40% of grid power before utilities would face the need to fund significant investments with higher electricity prices."
Wood doubled down on her stance by tweeting to her nearly 900,000 followers in April that she is collaborating with Square to debunk the idea that bitcoin mining is detrimental to the environment.
Musk on Wednesday evening announced he is suspending the purchase of Tesla vehicles using bitcoin, citing environmental concerns.
"We are concerned about the rapidly increasing use of fossil fuels for bitcoin mining and transactions, especially coal, which has the worst emissions of any fuel," Musk said in a tweet.
Musk did clarify that Tesla will not sell its bitcoin holdings, and instead, will use the digital currency for transactions as soon as "mining transitions to more sustainable energy."
But as Bloomberg reported, Ark has a profit motive in promoting the positive environmental impacts of bitcoin. Ark is invested in Coinbase and Square, companies tied to the success of cryptocurrencies and which have slumped following Musk's announcement.
Three out of six of Wood's exchange-traded funds - Ark Innovation ETF, ARK Autonomous Technology & Robotics ETF, and ARK Next Generation Internet ETF - count Tesla as their top holding.