Elon Musk announced today that his electric carmaker Tesla Inc (NASDAQ:TSLA) will begin to accept dogecoin as payment for Tesla merchandise on a test basis initially.
"Tesla will make some merch buyable with Doge and see how it goes," Musk said in a tweet on Tuesday.
Musk also revealed today he sold some US$906.5mln worth of Tesla shares - read the full article here
The decision to accept Doge comes seven months after Musk asked his then 54mln Twitter followers whether they would like the world-leading electric vehicle producer to accept Doge in a poll.
Dogecoin, the world’s best-known ‘meme-coin’ and the ninth most popular cryptocurrency globally by market value, jumped some 29.3% to US$0.214 following the news.
The merchandise that Tesla sells includes mini models of its vehicles, apparel, belt buckle, quad bike ‘Cybersquad’ for children, and the ‘Cyberwhistle’ that is modeled after the much-awaited Cybertruck that will be released in 2023.
In May, Musk backtracked on Tesla’s decision to allow Bitcoin (BTC) for car purchases just two months after the company agreed to accept BTC.
Musk said the highly energy-intensive process of Bitcoin mining went very much against his green energy mantra.
This, coupled with Musk labeling dogecoin as a ‘hustle’ during his guest-host spot on the ‘Saturday Night Live’ comedy sketch TV show in May, sent the price of Doge sliding almost 40% to US$0.365 from US$0.636.
Dogecoin currently has a market capitalisation of approximately US$28.5bn with 132.5bn Doge in circulation, while its market value peaked earlier this year at US$85bn.
Doge is the most popular cryptocurrency in the US based on average monthly searches, according to coinmarketcap.com.
Despite its surge in price in today’s early afternoon trading Doge is still well off its all-time high of roughly US$0.74 on 8 May, which was under a week before Musk’s appearance on ‘Saturday Night Live.’
Even so, a year ago Doge was priced at just US$0.0032, so today’s price still marks an upside of roughly 6500% year to date.
Whilst dogecoin has largely been speculative trading, it has also had a practical use on Reddit and Twitter to reward the creation or sharing of quality content.
Doge was created in 2013 as a joke and was meant to be a satirical alternative to the hype around Bitcoin, and was named after the ‘doge’ meme – the one that features the Japanese dog breed, Shiba Inu, along with misspellings and odd grammar.
Although, Doge differs from many other cryptos as it is mined far more easily and with less equipment, while in theory, there could be an infinite supply of Doge as it is not capped at a particular figure.
Musk said in a Tweet in October that the only three cryptos he would ever hold, and did hold at the time seven weeks ago, were Dogecoin and the world’s two leading cryptos: Bitcoin and Ethereum.