Dogecoin price surges by 25% after Elon Musk announcement

(REUTERS)

Dogecoin has surged by as much as 25 per cent in the wake of a new announcement from Elon Musk.

The Tesla chief executive said his electric car company would start taking payment in the cryptocurrency “and see how it goes”.

That could suggest that he is planning to accept the cryptocurrency in payments for cars. Tesla previously did so with bitcoin, but said earlier this year that it was reversing that decision amid fears over its environmental impact.

““Fundamentally, bitcoin is not a good substitute for transactional currency,” Musk told Time as part of its announcement that he was 2021’s Person of the Year. “Even though it was created as a silly joke, dogecoin is better suited for transactions.”

Dogecoin rapidly jumped 25 per cent in the wake of Mr Musk’s tweet, announcing Tesla’s change of policy. It settled a little shortly after, and is now up 15 per cent at the time of publication.

The price of the coin has been largely stable in recent months, and has been trading consistently down since the beginning of November.

Even after Mr Musk’s recent intervention, the price is a long way from the heights it reached the in May, when he was busily giving his public backing to the cryptocurrency.

Then, it reached a high of $0.722320, before plunging back down again. Even after the latest increases, it is still only trading around $0.188624.