Dogecoin has jumped by more than eight percent in recent weeks after it was announced that new Twitter CEO Elon Musk was considering the altcoin as a potential payment tool for users of the social media platform.
Elon Musk Is Still Appreciative of Dogecoin
To say that Elon Musk is a fan of Dogecoin would be an understatement. He has often been very kind to it, often calling it the “people’s crypto” and designating it as a method of payment for his many other companies, so it makes sense that he would do the same on Twitter, the latest mark in his ongoing string of enterprises.
In fact, it’s probably fair to say that Musk has been much fairer to Dogecoin than he has to bitcoin. While he and Tesla still have BTC – the world’s number one digital currency by market cap – as part of their portfolios and/or balance sheets, they have sold much of the asset and are only keeping a little bit at press time.
While the reasons for this are speculative, you can argue that Musk is no fool. He likely realizes that bitcoin, with it being the biggest digital currency, still has room to grow, and he wants to be there when that happens.
However, Musk initially decided that Tesla cars and automobiles could be purchased with bitcoin back in early 2021, nearly two years ago. Things were really looking up as at the time, BTC was trading in the $50K range and the asset looked like it was on top of the world. However, Musk later rescinded the decision, claiming that BTC mining was irresponsible and causing harm to the planet.
Still, if he were to establish Doge as a legitimate payment tool for Twitter, the move would push the goals of crypto closer to being achieved.
What many people forget is that while crypto has taken on an either speculative or even hedge-like status in recent years, it was initially designed to serve as a payment tool. It was built to push checks, credit cards, and fiat currencies to the side, but this has been a relatively slow journey given the volatility that continues to drag it down.
Volatility Is a Problem
It’s hard to understand when crypto prices will go up or down. Many stores and companies have been reluctant to say “yes” when it comes to accepting crypto for this reason, and to a degree, we can’t blame them.
Consider the following scenario: someone walks into a store and buys $50 worth of merchandise with bitcoin. The store doesn’t trade the BTC into fiat right away and about 24 hours go by. From there, the price of BTC goes down and that $50 becomes $40. The customer gets to keep everything he or she bought, but the store has lost money.
