No one loves Dogecoin more than Elon Musk! Find out why the multi-billionaire has such an affinity with the animal coin
The world’s richest man and a dog meme coin – surely a match made in heaven? You can’t help but find the bizarre relationship between Elon Musk and the dog-faced coin amusing. Some people view it as simply making light of the cryptocurrency industry, others, including myself, appreciate what Dogecoin represents and ultimately why it makes it so appealing to Elon Musk.
Elon Musk’s widely publicised endorsement of Dogecoin saw the cryptocurrency skyrocket 216% in 24 hours. Meanwhile, a lot of newcomers also had a meteoric rise, including Solana which gained 1100% over the year. However, unlike most cryptocurrencies in the space, Dogecoin is a veteran that has been around since 2013. It is only surpassed in duration, recognition, and stature by the king of crypto that is Bitcoin. So, how has it survived all this time?
Firstly, as you begin to understand crypto more, you realise that its very existence is based on decentralisation. In addition, this forged a community of individuals called Cypherpunks. Collectively, they opposed authority and central rulers. On the one hand, this ideology led to the formation of Bitcoin, which is arguably the soundest money ever created. But, on the flip side, decentralisation presented an opportunity for a satirical version, one that fails to implement any monetary nor progressive fundamentals. Here’s introducing Dogecoin.
As a dog-faced meme coin, it acts as the polar opposite of Bitcoin. Bitcoin is scarce, with a limited supply of 21 million, whereas Dogecoin was created intentionally to have an uncapped limit. Consequently: 10,000 new coins minted every minute. Therefore, it makes you question how the world’s richest man would be drawn to Dogecoin over Bitcoin. Essentially, it lies with Elon Musk’s eccentric personality taking precedence over his undoubted business prowess.
It would be a lie to say Elon Musk disregards Bitcoin for Dogecoin. On the contrary, Elon Musk is a firm believer in Bitcoin and followed up his conviction with a purchase of over $1.5 Billion back in February 2021 (which he still holds today). Most importantly, the answer to the question in the previous paragraph is based on the personality and moral stance he withholds. Moreover, Musk speaks very publicly about his distaste for government intervention and malpractice, notwithstanding his equal enjoyment of posting memes on his Twitter account. Above all, it is these very same principles that birthed Dogecoin in the first place, which is why his connection with it is so transparent.
The Dogecoin mania phase in 2021 was largely influenced by Elon Musk and his amusing tweets. For instance, Musk initially expressed his love for Dogecoin calling it the “people’s crypto” before eventually accepting Dogecoin for Tesla merchandise. Whilst his intentions are great, there is perhaps a sense of irresponsibility. Primarily, this is due to the fact that investors speculate on his next tweet, instead of evaluating what fundamentals are behind it. Inevitably, a percentage of his 75 million followers will take what he says at face value.
It is worth considering the implications for new investors that decide to invest based on Musk’s intent to put a literal Dogecoin on the moon from his SpaceX rocket. Certainly, it is brilliant to make such extraordinary events happen, but the risk associated with it in an unregulated market should not go unnoticed. At the end of the day, fundamentals are the most important aspect of any investment, and whilst there is no harm speculating if you understand the risk, be aware that you could lose your investment at a moment’s notice.
To sum up, Dogecoin certainly encapsulates the “wild west” of cryptocurrency. This is a common term used by the financial establishment as an attempt to stain the industry disruption technology. Love it or hate it, Dogecoin is a symbol of a community of people that repel against what the current system represents. With that said, Dogecoin must be remembered for what it actually is, and that’s a meme coin. Ultimately, it would be advisable to take whatever Elon Musk has to say about Dogecoin with a grain of salt.
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