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Watch: Bitcoin drops as Elon Musk says Tesla won't take it
The billionaire said he "believes in crypto" but remains concerned about bitcoin's energy usage.
"To be clear, I strongly believe in crypto, but it can’t drive a massive increase in fossil fuel use, especially coal," Musk wrote on Twitter.
Bitcoin was down another 2.6% to $49,898 on Friday morning.
Bitcoin's slide comes after Musk unexpectedly withdrew Tesla's support for bitcoin payments earlier this week. The move sent bitcoin's price diving.
On Wednesday evening, Musk raised concerns about how much energy the technology uses. According to Cambridge University, bitcoin mining accounts for 0.7% of the world's electricity consumption.
Read more: How bad is Bitcoin for the environment?
"We are concerned about rapidly increasing use of fossil fuels for bitcoin mining and transactions, especially after coal, which has the worst emissions of any fuel," Musk tweeted.
The Tesla boss reversed a decision made just months before to accept bitcoin as payment for his electric vehicles.
"Even before Musk’s tweets there were already signs that the astonishing rally we saw in bitcoin around the turn of the year has begun to peter out, with April seeing its first monthly decline since September," said Jim Reid, a strategist at Deutsche Bank. "Its performance so far in May leaving it on track for a second one."
Bitcoin and cryptocurrency prices have surged since last October thanks to increased institutional adoption. Tesla announced earlier this year it had invested $1.5bn in bitcoin, for example.
However, some analysts have said the rally was approaching bubble territory.
Musk has been a long-time supporter of cryptocurrencies, especially bitcoin and Dogecoin. The businessman often tweets about bitcoin and cryptocurrencies, contributing to price swings. In January, he sent bitcoin soaring after tagging the crypto in his Twitter bio.
Watch: What is bitcoin?