Dogecoin Rockets 20% After Elon Musk Says Tesla Will Use for Merch Payments

Elon Musk, Tesla CEO, has announced via Twitter that Tesla will begin accepting Dogecoin as payment for merchandise.

"Tesla will make some merch buyable with Doge & see how it goes," Musk tweeted. 

The news comes a day after Elon Musk was announced as Time Magazine's Person of the Year for 2021.

Since this news broke, Dogecoin's price has surged by 19.5% on the day.

Elon Musk and Dogecoin

The Tesla CEO has a long and well-established relationship with meme cryptocurrency Dogecoin.

In May of this year—around the same time he reversed course on Bitcoin—Musk said that Dogecoin could beat Bitcoin "hands down."

He proposed a reform of sorts for the cryptocurrency which would entail speeding up its block time and block size, and also decreasing fees by 100x.

These aren't just empty words from Musk, either. The Tesla CEO has been working with Dogecoin developers to try and improve the cryptocurrency,  in a bid to make it cheaper and more energy-friendly than Bitcoin—the crypto industry's flagship asset.

In April, Musk even called himself "The Dogefather" when he announced that he would be appearing on Saturday Night Live on May 8, 2021.

Dogecoin has also benefited from Musk's interest in the meme cryptocurrency. In October, Dogecoin's price surged after Musk replied to a tweet predicting he'd become the world's first trillionaire.

"*In Dogecoin," Musk said.

Data from the Blockchain Research Lab has actually shown that Musk's positive-Dogecoin tweets have actually sent the meme cryptocurrency surging by almost 20%.

This, in turn, raises some ethical questions for the newly appointed Time Magazine Person of the Year.

"Our results lead to the question under which conditions people in the public eye should comment on specific cryptocurrencies," Lennart Ante, a researcher at the Blockchain Research Lab previously told Decrypt.