What was, at first, a simple joke, will become a real currency. In a tweet published this Friday, January 14, the whimsical boss of Tesla, Elon Musk, announced that his company would now accept Dogecoin for the purchase of some of its derivative products. As detailed on the site Fortune.com, the price of the Tesla flocked whistle or the Cyberquad for children is now displayed in dollars and in Dogecoin. The first thus costing 300 Doge.
The billionaire had been casting doubt on Tesla’s use of virtual currency for several weeks. The confirmation of this decision caused the price of the cryptocurrency to skyrocket, launched in 2013 as a joke, with the image of a Shiba Inu, dog of the Dodge meme. In May 2021, its value was multiplied by 10,000 when Elon Musk began to share his passion for this virtual currency, close to bitcoin, but considered less “safe”.
Very unstable prices
Because Dogecoin is a particularly volatile currency. A good thing if we are to believe Elon Musk who admits to preferring transactions in Dogecoin rather than bitcoins, because its status as a highly volatile asset “causes people to spend it rather than keep it as a store of value” , like what is done for bitcoin. However, the huge variations in the price of Dogecoin can cause the prices of certain products to jump. The Tesla whistle, today displayed at 300 Doge, is now worth $58, but if the currency goes back to its 2021 level, it would then cost almost $200.
As reminded Numerama, on May 8, when Elon Musk had assured, in a sketch for a television program, that the Dogecoin was “a scam”, its price had gone from 70 to 48 cents before fluctuating constantly. Since then, the cryptocurrency has lost almost 80% of its value compared to May 2018. But Elon Musk’s announcement of Tesla product purchases with Dogecoin could help stabilize its price, as the electric car giant has any interest in virtual currency stopping its decline.