When Elon Musk tweeted “Let’s make Twitter maximum fun!” on Thursday, some may wonder if dogecoin is included in the mix.
The Tesla (TSLA) – Get Tesla Inc Report CEO and world’s richest man has been quite bullish on the Shiba-themed crypto and interest surged dramatically when the deal to acquire Twitter (TWTR) – Get Twitter, Inc. Report was announced earlier this week.
‘Unleash the Doges!’
Online searches for “Buy Dogecoin” exploded 392% on April 25, the day the $44 billion-deal hit the news, according to CryptoWallet.com. Google searches for “How to buy Dogecoin” also increased 301% on the same day, as well as “What is Dogecoin”, which rose 237%.
One person on Twitter posted an image lifted from “The Lion King” that depicts Musk holding up a dogecoin cub.
“Unleash the doges!” the caption reads.
“Hate him or love him, but there’s no doubt that Elon Musk is one of the greatest influencers and innovators of the 21st century,” said Tammy Da Costa, an analyst with DailyFX. “With his extravagant ideas and his ‘subtle’ innuendos, Tesla’s CEO and founder of SpaceX also played a major role in promoting the adoption of bitcoin as a means of payment, driving the price of the original crypto just below the $65,000 handle in April last year.”
Shortly after reaching this mark, Da Costa said Musk criticized the coin’s energy consumption, removing it as an alternative payment method for Tesla.
Dogecoin currently trades at $0.140057. The meme coin reached an all-time high of $0.731578 on May 8.
“While this sent shockwaves through the crypto realm, dogecoin–the cryptocurrency that was originally created as a joke in 2013–soared as the self-proclaimed ‘Dogefather’ displayed optimism over the meme coin,” she said.
Although bitcoin remains in the lead as the largest cryptocurrency in terms of market cap, Da Costa said, “the scarcity and limited amount of coins could support its perceived intrinsic value, for now, the environmental implications could limit bitcoin’s gains.”
Musk has suggested that Twitter could improve by adopting a subscription model, which he called Twitter Blue and that subscribes should be able to pay in dogecoin.
“With a current Twitter following of 87.8 Million, dogecoin could continue to rise if the decision to implement the coin as a payment method increases institutional interest, she said. “With thousands of cryptos now available to trade, the blockchain is where the ‘value’ lies.”
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“Elon Musk’s acquisition of Twitter may shake up the cryptocurrency market, as most cryptocurrencies have no assets and only perceived value,” said Alex Konanykhin, founder of Unicoin. “For example, the EBT token zoomed over 10500% after the announcement was made public.”
Konanykhin said Musk “enjoys commenting on cryptocurrencies, and his single tweet may significantly affect the valuation of no-assets coins, like the ‘doggy coins’ – Dogecoin and Shiba Inu coin.
Frank Corva, cryptocurrency specialist with Finder, said that “it is surely possible that Musk will begin to Tweet/meme about dogecoin again.”
“Though he’s been relatively quiet about DOGE since his appearance on ‘Saturday Night Live’ in May of 2021, prior to the price of DOGE peaking at just over $0.70,” Corva said, “some believe that he will work to integrate DOGE as a payment network on Twitter.”
Corva said the price of dogecoin jumped about 25% following the Twitter purchase, as “some in the Twitterverse speculated about how he might integrate DOGE into Twitter similar to the way that Bitcoin’s Lightning Network has been integrated to facilitate ‘tipping’ in bitcoin.”
“Some feel that Musk may prefer DOGE to bitcoin because Musk has the potential to exert more control over DOGE,” he said. “Because there is no hard cap on the amount of DOGE coins that can be created, Musk could exercise more control over DOGE’s monetary policy than he could over Bitcoin’s, which is fixed.”
Corva said Musk’s people, alongside Ethereum founder Vitalik Buterin, met with DOGE’s developers last year when The Dogecoin Foundation was looking to hire staff and work on DOGE full time.
Still, he said, the few times that Musk has Tweeted or memed about DOGE since hosting SNL, the price has not reacted much.
“For Musk to influence or catalyze another dramatic rise in DOGE’s price, he would likely have to announce that he is doing something substantial with the cryptocurrency, as, over the course of the past 11 months, his playful rhetoric around DOGE hasn’t done much for its price,” he said.
Alex Lemberg, CEO of Nimbus Platform, said Musk seems committed to leveraging doge as a transactional coin once he takes over Twitter.
“There are undoubtedly fundamental issues with doge; in no small way they will need to increase their block size, block speed, and its inflationary structure isn’t overly conducive either,” he said.
However, Lemberg added, “the more cases in which DOGE begins being used in a transactional capacity the greater the propensity for a price increase and stabilization.”
“That said, it would take more than Twitter to make a major impact on the token long term,” he said.
Lemberg said dogecoin’s initial jumped following the Twitter acquisition announcement and its subsequent drop-off shortly after that “shows that the community is also questioning just how much impact Twitter can have on doge.”