Elon Musk, the CEO of Tesla, is known for making a lot of outlandish promises on Twitter, and some of the promises he makes take a long time to come true. However, the world’s largest electric car manufacturer has made good on one said promise. Last May, Elon Musk put out a poll on Twitter asking his 70 million followers whether they want Tesla to accept Dogecoin. Well, Dogecoin is now accepted at Tesla’s online store. And to the pundits said Crypto was dead, Elon just resurrected it.
At exactly 7:53 pm PST (3:53 UTC) on January 13th, Dogecoin (DOGE) payments went live on the Tesla online store, prompting the token to jump 11 percent shortly thereafter. The announcement comes about a month after Tesla CEO Elon Musk stated in December 2021 that the electric-car manufacturer will accept Dogecoin as payment for its goods. “Tesla will make some merch buyable with Doge & see how it goes,” he said at the time.
What is Dogecoin?
According to CoinMarketCap, Dogecoin, which has the image of the Shiba Inu dog as its logo and namesake, had a market worth of $22.19 billion at the time of publication, making it the most popular.
The cryptocurrency is regarded as the first of the so-called “meme coins,” which are inspired by a meme or have some hilarious feature. It was designed by software engineers Billy Markus and Jackson Palmer as a “joke,” mocking the excessive speculation in cryptocurrencies.
Musk has made no secret of his fondness for cryptocurrency and Dogecoin in particular. Tesla began accepting bitcoin for automobile payments in March of last year. However, in May, it stopped taking bitcoin for auto sales owing to 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,” Tesla said at the time. Nonetheless, according to CoinGecko, Tesla presently has 48,000 bitcoin on its balance sheet, which is worth more than $2 billion at current pricing.
It remains to be seen if Dogecoin can hold onto Thursday’s gains. The news wires tomorrow morning and the onslaught of Tesla stories around this event will most certainly be crucial to sustaining the surge. However, downside risks remain due to the negative sentiment in the larger crypto market towards the FED’s monetary policy and greater regulatory scrutiny on cryptocurrencies. Tesla is simply responding to consumer trends and Dogecoin presents it with 22.19 billion reasons why customers should have the option to use their Dogecone for something other than speculation.