Good morning, everyone and welcome to another week, here on Planet Earth. However, let us not be bound by mere physics and take a trip to the Moon; welcome to this week’s News, Views and Truths.
Despite the UK local elections, Scottish parliamentary elections and the English mayoral elections, much of the market focus this week, has been on what occurred on Saturday night on US television.
Saturday Night Live is a late-night, sketch comedy show that has run since 1975. It regularly has viewer numbers of around 8 million each week and attracts big names in the US comedy scene such as Chris Rock, Amy Poehler and Andy Samberg. This show is big time – but what has it got to do with markets?
Well, Saturday’s show had a special guest, none other than Tesla CEO, Elon Musk who appeared alongside Miley Cyrus. This, in itself, would not usually make waves. However, the world of Mr Musk is never a quiet one and his recent promotion of the cryptocurrency, Dogecoin, has resulted in wild market swings. And this continued on Saturday night.
For those of you who have not heard of Dogecoin, it is another digital currency, albeit one with a less than serious background. You see, Doge, is the name of a Japanese Shiba Inu dog who has become famous, due to its facial expressions, within internet culture. The creators of Dogecoin, or rather the algorithm that produces the coins, used the image of Doge to appeal to younger crypto aficionados who initially built positions within the coin for comedic value.
This was back in 2013. However, at the beginning of this year, due, in part, to tweets regarding Dogecoin by Mr Musk, the digital currency went up by over 800% in 24 hours, attaining a price of $0.07. Dogecoin hit a new high price of $0.08 following Twitter encouragement from Musk, Snoop Dogg and Gene Simmons. In March 2021, Dallas Mavericks owner Mark Cuban announced his NBA basketball team would allow the purchasing of tickets and products with Dogecoin and, within two days, Cuban had declared his franchise had become the top Dogecoin merchant, having carried out 20,000 transactions.
More recently, Dogecoin and other cryptocurrencies surged, stimulated partially by the direct listing for cryptocurrency exchange Coinbase on April 14th, although this platform did not actually provide trading of Dogecoin. Its price first reached $0.10 on April 14th before hitting a new high of $0.45 on April 16 (up 400% that week), with a volume of nearly $70 billion traded in the preceding 24 hours. Last week, the value of Dogecoin first surpassed the symbolic hurdle of $0.50, a greater than 20,000% increase in one year.
And so, what can stop Dogecoin? Well, Elon Musk.
As the self-proclaimed “Dogefather” made his Saturday Night Live debut, the price of Dogecoin fell off a cliff, falling as much as 29.5% and dropping to 49 cents at one point. Musk mentioned Dogecoin in his opening monologue and said dogecoin was a “hustle,” and howled, “To the moon,” a catchphrase popular among Doge enthusiast’s intent on driving the value of the cryptocurrency to one dollar.
And yet, the following day, Elon Musk has said his rocket company SpaceX will now accept the meme-inspired cryptocurrency Dogecoin as payment. In a tweet, he said the commercial space exploration firm will launch the “DOGE-1 Mission to the Moon” early next year.
Is this a game? If you have a position in Dogecoin, these wild swings can be dizzying. But it seems that Mr Musk is determined to get the digital currency to the moon, in more ways than one.