Tesla now allows its customers to purchase some of its merchandise using Dogecoin. This opens up a completely new avenue in the domain of institutional acceptance of cryptocurrency. The move was first hinted at a month ago when Elon Musk, the company’s CEO, mentioned a proposal in his tweet. There are also speculations that Tesla may in the future start accepting crypto payments for its vehicles. Any investor that wants to benefit from the cryptocurrency wave while staying safe from volatility, should invest in Stablecoins.
Impact of Tesla’s Announcement on Dogecoin’s Price
After Tesla made the announcement and began accepting the meme coin, the price of Dogecoin rose significantly. The announcement was made by Musk on through a tweet. The first day after the announcement, Dogecoin’s price increased by 11% to touch $0.19 per coin, with the price rising up to 16% in between to touch $0.20.
The merchandise and products that are available for purchase with the coin include:
- Cyberquad for Kids at 12,020 Doge
- Cyberwhistle at 300 Doge
- Giga Texas Belt Buckle at 835 Doge
It is not just Tesla that is allowing Dogecoin to be used for purchases. SpaceX, another one of Musk’s ventures, has already been accepting the digital coin since May 2021.
Elon Musk’s Interest in Dogecoin
The Tesla CEO showed his interest in Dogecoin back in May 2021 when he emphasized its efficiency compared to Bitcoin. In December, he announced that his company would be accepting Doge for some merchandise.
All this happened after Tesla began accepting Bitcoin for its cars back in February last year, but stopped the initiative due to Bitcoin’s high energy consumption and environmental impact.
Dogecoin is seen as a much more energy-efficient alternative to Bitcoin. It consumes lesser power for mining, as it is priced much lower.
Musk has also been working with the developers behind the meme coin to improve its efficiency. For the effort to fructify, the coin’s value will have to be decreased. At the same time, Block, another company headed by Jack Dorsey, is building an open Bitcoin mining system with a focus on greater efficiency.
Dogecoin started life as a meme and Musk has been open about his support for the coin. According to him many people in both Tesla and SpaceX already own Doge. This includes ordinary people who are not financial experts and this is the reason Doge seemed to him to be people’s crypto.
Musk is so interested in Dogecoin that he has planned a satellite launch for the moon named after the meme coin. The satellite will be launched next year and has been named DOGE-1.
Dogecoin & The Energy Efficiency Scenario
While Dogecoin doesn’t consume as much energy as Bitcoin, this is primarily because of its current low value. It is still considered to be energy-intensive because it is based on the proof-of-work (PoW) model.
According to Musk, cryptos are excellent ideas at many levels and they have a promising future. However, the environmental cost is still a concern to him.
Tesla’s Crypto Push
Tesla seems to have made Dogecoin the only option to purchase certain merchandise, with the standard payment icons being no more visible for these items.
Earlier Musk referred to himself as The Dogefather. In February 2021, Tesla invested $1.5 billion in Bitcoin with the goal of diversifying and optimizing returns on its cash. This was followed by the company’s acceptance of BTC for vehicle orders. The company reversed this decision due to energy consumption concerns.
SpaceX’s plans of launching DOGE-1 also seem to be good news for Dogecoin. This along with the latest announcement is expected to affect the high volatility of the cryptocurrency. All these steps by Musk and his companies seem to solidify Doge as a more reliable digital currency. The moon launch is planned for the first quarter of 2022.
SpaceX is accepting Dogecoin as payment for the mission. It will be a 40 kg cube satellite that will be sent into space with the help of a Falcon 9 rocket.
Tesla’s latest acceptance of Dogecoin is a big crypto push towards institutional acceptance. It is expected to inspire more retail and institutional investors to invest in cryptocurrencies. The launch of the DOGE-1 satellite is further expected to strengthen this meme coin and attract more investors.
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