Dogecoin has rebounded by more than 31% on the back of news that it will be listed on the Coinbase exchange and that Elon Musk is working on ways to make it greener.
The so-called “memecoin” had crashed earlier this week, falling from a high of $0.71 on Saturday (May 8) to $0.36 yesterday. But the dual announcements helped push it back up to above $0.50, even as other cryptos continued to fall or experienced much smaller rises.
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The Coinbase (opens in new tab) news is particularly important, with CEO Brian Armstong telling investors that it will add the cryptocurrency to its platform within two months.
Coinbase is one of the more recognisable names in cryptocurrency trading online, but Dogecoin had until now been absent from the exchange; though users have been able to track its value on Coinbase, they could only buy it on rival sites such as Robinhood and Binance.
The move should help legitimize the coin, which some still consider to be a joke, despite it consistently sitting at number 4 in the list of top cryptocurrency performers by value, with a market capitalization of more than $60 billion.
Meanwhile, Musk was also making his own announcement, telling his 53m Twitter followers that he was “Working with Doge devs to improve system transaction efficiency. Potentially promising.”
It’s been quite the week for Dogecoin and Musk: the Tesla boss’ tweet came a day after he caused a $365 billion drop in the cryptocurrency market by announcing that Tesla would no longer accept Bitcoin due to concerns over its environmental impact, with Doge among the crypto funds affected by his tweet.
Musk also clarified that statement late last night, posting “To be clear, I strongly believe in crypto, but it can’t drive a massive increase in fossil fuel use, especially coal” — presumably a reference to the fact that the mining of Bitcoin uses considerable power, and much of the mining happens in China where coal power is being used for low-cost electricity.
However, Dogecoin had already been on the slide due to comments Musk made about it in his Saturday Night Live hosting slot. The guest appearance had been expected to send Doge to new heights, but instead the coin tanked after Musk called it a “hustle.”
Not that all of the billionaire’s Doge dealings have been negative this week: he also posted a poll asking his followers if they wanted Tesla to accept Dogecoin — 72% voted that they did — and announced that his SpaceX company was sending the DOGE-1 satellite into space on a mission funded entirely by Doge.
What’s not clear yet is whether Tesla will switch to accepting Dogecoin. With Elon Musk’s obvious support for the currency, it’s not beyond the realm of possibility that it could be an alternative to Bitcoin. It is, however, a less mature coin and it would risk Tesla profits if it relied on a currency that’s still fluctuating wildly.
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