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Dogecoin Value Jumps After Elon Musk Announces It as Currency For Tuition at Fictional University

Photo and tweet posted by @elonmusk on Twitter.

Photo and tweet posted by @elonmusk on Twitter.

The price of the cryptocurrency Dogecoin shot up from $0.25 to $0.28 minutes after Elon Musk's tweet.

It’s another day of an onwards and upwards journey ‘to the moon’ for cryptocurrency Dogecoin. Dogecoin started as a joke, when it was first created in 2013. In 2021, however, the joke appeared to have turned on those who didn’t take the meme cryptocurrency seriously. The meme-cryptocurrency Elon Musk wouldn’t stop tweeting about reached an all-time high in mid-April, crossing 10 cents for the first time. The market cap of DogeCoin — which started as a joke and is literally classified as “a meme coin" — is currently over $74.13 billion. This is the highest-ever for the cryptocurrency, and the result of a semi-ironic movement that’s involved thousands of buyers, tens of thousands of online posters and the world’s richest man, Elon Musk. In early January, each token was worth less than one cent. In late January, when both the GameStop and DogeCoin movements hit their stride, the value of DogeCoin shot up to 7.5 cents, well over a 10-magnification, before sliding down to 2.5 cents. A large chunk of this rise is attributed to Musk, and the Internet has even come up with a name for the co-relation between his tweets and the subsequent rise or fall in prices: ‘The Musk Effect.’

Late on Sunday night, Musk posted a semi-ironic tweet on accepting Dogecoin for a so-far fictional University he wants to set up. Earlier, on October 29 Musk had tweeted he plans on “starting new university: Texas Institute of Technology & Science." While the acronym set up the joke, Musk’s tweet about accepting Dogecoin cryptocurrency as the only fees for tuition has cemented it further. But with Musk, you can never really tell which idea is a joke - and which joke really becomes true.

Following Musk’s tweet, Dogecoin recorded a jump in prices, coinciding with 23:50 PM IST (GMT+5:30). The price of the cryptocurrency shot up from $0.25 to $0.28 minutes after Elon Musk’s tweet. Dogecoin spin-off cryptocurrency Shiba Inu, also recorded a slight jump a few hours after Musk’s tweet, according to Coindesk data.

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Musk in an interview earlier this year had mentioned that Dogecoin cryptocurrency may be the future. In the interview, he says that “There is a good chance that crypto is the future currency of the world. Then the question is which won is it going to be? It could be multiple," he said. He then explains the origins of how Dogecoin was invented as a joke, essentially to make fun of cryptocurrency, and that’s the irony, explains Musk. “That the currency that began as a joke, becomes the real currency." In the video, he does add that, “Don’t invest your life savings into cryptocurrency. That’s unwise."

What is dogecoin? Dogecoin, much like Bitcoin, is a digital coin used for e-transactions. Doge is a reference to the ‘doge’ meme and has a picture of the shiba inu on it. It is a cryptocurrency, a form of digital money that, much like bitcoin, enables peer-to-peer transactions across a decentralized network. Since its creation, Doge has also been used to donate money to charities. These have included the 2014 Jamaican Bobsled team who couldn’t afford to get to the Sochi Winter Olympics, a Nascar driver named Josh Wise, and a clean water project in Kenya called Doge4Water. At the peak of the meme’s popularity in 2013, Palmer, an Australian marketer, made a joke combining two of the internet’s most talked-about topics: cryptocurrency and Doge. He bought the Dogecoin.com domain and uploaded a photoshopped Shibe on a coin. The peak price of Dogecoin in 2018 was around two cents, right before it crashed along with the rest of cryptocurrency. Reports suggest that by early 2019, Dogecoin had lost nearly 90 per cent of its value and was trading for a fraction of a penny, until now.

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first published:November 01, 2021, 08:21 IST