While the Tesla founder has proven inspirational in the past, with Bitcoin, he has fallen prey to his own eccentricities.
Tesla’s FUD bitcoin announcement doesn’t mean bitcoin is overvalued; it does mean Tesla is overvalued. Tesla cars are expensive luxury items and their purchase is justified by Tesla being an aspirational brand. That brand is extremely dependent on the mystique of Elon Musk; can Musk lose that mystique? Well, he just did with Bitcoiners and soon with others too.
There are many types of inflation in the world. The Federal Reserve prints money to fund an economic system that has become wasteful and corrupt. Elon Musk has been spending the currency of his reputation to build a company that currently can’t justify its valuation. In both cases, bitcoin is the antidote.
For over a decade, I have been an unabashed Elon Musk fanboy. The scope of his world-changing ambition was a shining beacon of hope in a world that had surrendered to pessimistic malaise. They promised us flying cars, instead we got dumb mobile apps. Elon proved that the human spirit could think bigger.
Over the years, my Elon fandom has become more mainstream. Elon Musk has become a household brand. He has used that well-deserved fame to turn Tesla into an aspirational luxury brand. He has used the goodwill of his fanboys to be forgiven for everything from building his company on government handouts, to missing deadlines, to calling a rescue diver a pedophile. All the while, Tesla shares grew to a market cap larger than the big-five automakers combined — just as competition in electric cars has heated up from the likes of Mercedes on the luxury scale and Toyota for the everyman.
In the final stages of inflation, things tend to come off the rails. This seems to be happening to Musk. We should have some sympathy for his “fake it, till you make it” approach to building Tesla. Every truly ambitious idea must be fueled by hopium initially. The pressure on Musk now, however, is immense. With the scope of the ambition, and the elevated, unattainable expectations, things are now coming off the rails.
You either die a hero, or you live long enough to see yourself become the villain. The problem for Musk is that he has increasingly been building the hopium around a cult of personality rather than an idea. As he has become the focal point of attention, his reputational currency has lost touch with the fundamentals and become about celebrity. Musk is driving the Tesla brand rather than the other way round. The result is he has been needing to spend more and more of this currency just to stay in place. He has had to go from wrestling with Mars to a memelord wrestling with nonsense.
This is a very dangerous game. Any teenager who has had a disappointing crush knows how quickly adoration turns to hate. Musk has been setting up impossible expectations and betraying them at a faster and faster pace. He has already lost the Bitcoiners. What do you think will happen when an entire generation — the most social media–savvy generation — realize that the “Dogefather” has been hustling them?
I hope Musk can pull himself out of this erratic orbit around superficial, meme-driven fandom and return to the fundamentals. Here, he can take a lesson from Bitcoin. Bitcoin has died a thousand deaths in the media and always come back stronger. Why? Because Bitcoin is a pure idea. There is no cult of personality. Satoshi left so his idea could live. You cannot kill an idea whose time has come. Come back to the land of long-term thinking, Elon. Come back to Earth, so you can take us to Mars.
This is a guest post by Edan Yago. Opinions expressed are entirely their own and do not necessarily reflect those of BTC, Inc. or Bitcoin Magazine.