The value of novelty cryptocurrency DogeCoin soared by as much as 15% on Friday following Tesla allowing customers to buy merchandise with the coin. While DogeCoin was started as a joke, it’s earned praise by Tesla boss Elon Musk and has seen its value skyrocket by as much as 4,000% in the past year. So is DogeCoin for real and is it here to stay?
Musk sent a tweet on Friday morning that said, ‘Tesla merch buyable with DogeCoin.’ This simple tweet was enough to cause a DogeCoin buying frenzy, although it had been common knowledge the Tesla CEO was planning to use the cryptocurrency as a payment option at some point.
While customers can’t yet buy electric cars with DogeCoin, merchandise they can buy include belt buckles, whistles and children’s all-terrain vehicles. Interestingly, any purchases made with DogeCoin are non-refundable.
Tesla isn’t the only one of Musk’s companies to start getting serious about DogeCoin. Musk has also hinted that his space travel firm SpaceX would also take payments from the cryptocurrency.
While DogeCoin is currently Musk’s cryptocurrency of favor, it should be noted that the billionaire was once a big admirer of Bitcoin. After all, 2021 saw the price of Bitcoin soar after Tesla announced plans to let customers use the crypto to buy electric vehicles. However, Tesla quickly dropped Bitcoin shortly after amid ongoing concerns about the crypto’s harmful environmental impact.
Where can DogeCoin go from here?
While the value of DogeCoin fell back a bit later on Friday, it remained positive and the crypto has long since shrugged off its humble origins. The coin was first issued in 2013 when it was supposed to have been a mere parody of the speculative nature of cryptocurrencies.
However, thanks to a number of reasons – not least Musk’s endorsement – DogeCoin has become seen as a viable cryptocurrency. It’s something of an irony that DogeCoin’s biggest spikes come from social media comments as this is precisely the kind of trend that inspired the joke coin.
As such, there will be plenty of analysis over whether this is just a case of Musk leading a wave of amateur investors or whether the so-called ‘People’s Coin’ could be something a little more serious.
Few people would discount the fact that DogeCoin has managed to hit a market cap of over $22 billion in less than a decade, plus it has gained a certain level of respectability through its sponsorship of elite sports teams such as the Watford FC soccer club in the UK.
But it’s the fact that DogeCoin uses relatively little energy compared to other cryptocurrencies that is giving the joke coin a new lease of life. With market leaders like Bitcoin and Ethereum being slammed for their negative environmental impact, DogeCoin is starting to look much more respectable. All of which suggests that 2022 could well be another memorable year for this cryptocurrency.