Telsa Inc (US:TSLA, NASDAQ:TSLA) founder Elon Musk tweeted on Wednesday, May 12, that the electric vehicle (EV) company is suspending all purchases using Bitcoin.
He also hinted that the company is exploring other environment-friendly cryptocurrencies as they have a “promising future”.
After all this, on Thursday, the Tesla ‘Technoking’ tweeted, “Working with Dogecoin developers to enhance system transaction efficiency”.
This indicates that Doge could be the potential alternative to Bitcoin for Tesla.
Following this post, the crypto token rebounded as much as 25 per cent and reclaimed its fourth position in terms of market cap.
Elon Musk & Doge
Elon Musk’s private venture SpaceX has already started accepting transactions in Doge. On top of that, Mr Musk ran a poll on Tuesday asking his Twitter followers whether they want Tesla to accept Dogecoin.
Nearly four million of his followers participated in the polling and 78.2 per cent of them voted for Doge.
Last week, SpaceX received its first-ever Dogecoin transaction from Alberta-based Geometric Space Corporation to launch its payload ‘DOGE-1 Mission’ to the moon. Thus, streamlining Tesla transactions via Dogecoin might be more effective for the self-proclaimed ‘The Dogefather”.
If this happens, it could be a massive victory for the meme-inspired crypto to gain mainstream acceptance.
Meanwhile, Tesla continues to hold Bitcoins worth more than one billion and wants crypto miners to use sustainable energy sources. The company registered a profit of US$ 101 million from its Bitcoin holdings in Q1 2021.
Copyright ©Kalkine Media 2021
Why Elon Musk Could Choose Dogecoin?
There are nearly ten thousand crypto coins out there, but Elon Musk has more control over his so-called ‘adopted son Doge’. However, crypto analysts criticize dogecoin's project, especially the fact that it has unlimited token circulation.
Crypto purists reportedly do not want Mr Musk to switch to Doge, and if he does, they see it as a humiliation to the crypto market.
Meanwhile, the Tesla founder believes that Dogecoin is no more a meme-token because of its rising value and popularity among crypto investors. The token is up over 11,050 per cent in 2021, with a notable market of around US$ 70 billion.
Dogecoin’s technology is derived from the Litecoin project, which is easier to mine in comparison to Bitcoin. Hence, Mr Musk could prefer his favorite Doge over other cryptos for Tesla’s transactions. And if this happens, the Shiba Inu-mascot coin could skyrocket, or as ‘Dogefather’ puts it, “Doge To The Moon”.
The above constitutes a preliminary view and any interest in stocks should be evaluated further from investment point of view.