Dogecoin Price Skyrockets After Elon Musk Says Tesla Will Accept the Crypto for Merch

Dogecoin experienced a sharp increase in its price on Tuesday morning after Elon Musk tweeted that Tesla would allow people to buy merchandise with the cryptocurrency.

As a result, the price of the digital token had risen by nearly 30 percent in 24 hours at 7:30 a.m. ET on Tuesday to a price of roughly $0.21, according to price tracking site CoinMarketCap.

It brought dogecoin's market cap—the total value of all dogecoin tokens in circulation—to roughly $28.2 billion.

This price is likely to change rapidly. Cryptocurrencies are notorious for their volatile market value, and experts have previously warned Newsweek about the risks associated with trading them.

Prior to Tuesday's rise, dogecoin had been sinking in price for several weeks. It was worth around $0.15 on Monday, down from its three-month high of over $0.30 in late October.

Musk, head of Tesla and SpaceX, is well-known within the cryptocurrency community and has lauded dogecoin and other cryptocurrencies in the past.

His tweet on Tuesday quickly gained tens of thousands of likes and several thousand retweets in less than an hour.

It is not immediately clear when Tesla will make its merchandise available via dogecoin, nor whether this option will be limited to certain items.

In any case, it will not be the first time that Tesla has gotten involved in cryptocurrency.

In March this year, Musk announced that people would be able to purchase Tesla vehicles in the U.S. using bitcoin.

It came after the company revealed that it had purchased $1.5 billion worth of the cryptocurrency just weeks prior.

However, within just a few months Musk announced that Tesla would stop accepting bitcoin for car purchases citing environmental concerns over bitcoin mining—the process used to create new bitcoins. Musk later stated Tesla may start accepting bitcoin as payment again in future.

Musk's other venture, the rocket company SpaceX, has also gotten involved in cryptocurrency.

In a tweet back in May, Musk announced that SpaceX would be launching a satellite mission to the moon that would be paid for in dogecoin.

The mission, called Doge-1, will involve putting a small cube satellite into lunar orbit using one of SpaceX's Falcon 9 rockets in cooperation with digital asset exchange Unizen and tech firm Geometric Energy Corporation (GMC). It's due to launch in the first quarter of 2022.

Elon Musk and Dogecoin
Left: Elon Musk pictured at a TIME Person of the Year event in New York City on December 13, 2021. Right: A visual representation of a Dogecoin token, taken in Katwijk, Netherlands, on January 29, 2021. Musk is a well-known figure in cryptocurrency circles. Getty / Time / Yuriko Nakao / Theo Wargo