Elon Musk, the CEO of Tesla, announced that the company will accept the cryptocurrency Dogecoin for payment at their Santa Monica supercharging station. The news sparked a huge price spike for the cryptocurrency. Created in 2013, Dogecoin is a faster alternative to Bitcoin and a satire on fraudulent crypto coins. Its name is derived from a popular Shiba Inu meme.
Although the news is confusing, it is possible that Tesla is testing or preparing to accept Dogecoin as a payment method. It is not clear whether the company will accept Dogecoin for any future purchases, but announcing that they do may be a good first step for cryptocurrency enthusiasts. Musk has long championed Dogecoin and has spoken about it at various events. He has even joked about Dogecoin becoming the official currency of Mars.
Musk has also been active on Twitter, promoting dogecoin as a viable option for buying merchandise. As of late, the coin is already the eleventh largest cryptocurrency by market cap with $25.2 billion in value. However, the recent crypto market downturn has caused dogecoin’s price to fall to its lowest level since April 2021, according to Coindesk data. The cryptocurrency has also lost over 74% from its all-time high in May last year.
Elon Musk’s tweet announcing the news is a positive sign for cryptocurrency. Tesla has previously considered accepting the meme-inspired cryptocurrency as a payment option, but this has only happened for certain merchandise. For now, customers can buy collectible items or clothing based on dogecoin, but they will not be able to buy the electric cars themselves. To do this, customers must set up a dogecoin wallet and not pay with any other digital currencies.
Elon Musk also stated that he has invested in bitcoin personally and has smaller amounts in Dogecoin. He also noted that the company will accept dogecoin for its lunar mission. Musk has been very active on Twitter, and his company has made a name for itself in the retail trading frenzy. If Elon Musk is right, then Dogecoin is the future of transactional cryptocurrencies. And the CEO of Tesla Motors also believes this.
While the advantages of using Dogecoin over Bitcoin are substantial, there are also some drawbacks. However, the pros outweigh the drawbacks when it comes to cryptocurrencies. Bitcoin is much more stable and is used by many companies. And Tesla recently made its products available for purchase with Dogecoin until May 2021. Bitcoin is the most widely used cryptocurrency, and many other companies also support it.