Elon Musk: Crypto Puppet Master | DOGE Keeps Barking

ELON IS THE CRYPTO KINGMAKER

He giveth and he taketh away. After he set the crypto-world ablaze last winter with the dual announcements that Tesla bought $1.5 billion worth of bitcoin and would accept the cryptocurrency for vehicle purchases, Tesla CEO Elon Musk pulled the rug out from under the bitcoin community this week. In a tweet on Wednesday afternoon he said that Tesla would no longer accept bitcoin as a form of payment due to environmental concerns. Subsequently, the asset crashed below $50,000.

As of this writing, bitcoin has regained $50,000, but its situation remains tenuous as investors are further looking into ether and proof-of-stake coins that are more energy efficient, such as ADA, which surged on the news. Additionally, fears of rising inflation in the U.S. economy are creating whispers that the Fed may raise rates and reign in its inflationary spending, which could add additional downward pressure. Further, according to recent data from the Chicago Mercantile Exchange, asset managers have recently switched to shorting bitcoin, meaning that they are betting against the asset in the short term.

MUSK-ADO ABOUT DOGE

Although Elon Musk’s Saturday Night Live debut last week backfired, at least for DOGE holders, as the asset fell 30% following the episode, DOGE still has a spring in its four legs. While Tesla will no longer accept bitcoin, Musk posted a Twitter poll asking if the firm should accept DOGE, which saw more than 4 million responses (78% voted yes).

Although Musk’s affection for the meme-coin is well-known, his support for the now fourth largest asset by market capitalization is seen as a bit curious given that it relies on a similar energy-intensive proof of work consensus mechanism as bitcoin, which he had just criticized. Perhaps for that reason he also announced on Twitter his intention to work with DOGE developers to make the system more efficient. Based on this news, the price of DOGE surged again, although it has not recovered all its losses from last Saturday night. Price aside, more work on the asset would be welcome not just for the environmental benefits but also because dogecoin needs more developer activity to introduce new features and help ensure network security.

VITALIK’S BILLION-DOLLAR CRYPTO COVID DONATION

Ethereum’s co-founder Vitalik Buterin, who became the world’s youngest known crypto billionaire less than two weeks ago, donated more than $1 billion in crypto to the India Covid Relief Fund and a range of other charities this week. However, the way he made the donation is interesting as well. He did it by offloading massive amounts of dog-themed meme tokens, which he was gifted (without asking) by the creators of DOGE rip-offs shiba inu coin (SHIB), dogelon (ELON) and akita inu (AKITA). It appears that he was sent the coins under the assumption that they would not be sold or traded, as a way of stimulating demand for the assets. However, this massive liquidation event sent the price of these assets into free fall, suggesting that the amount of money actually donated will be far less than $1 billion when all is said and done.

BLOCKCHAIN 50 HOLDOUTS

Of the world’s ten largest publicly traded companies, eight are blockchain bulls—building a wide range of products that use the distributed ledger technology first popularized by bitcoin. Hugely absent from those blockchain fans: Warren Buffett’s Berkshire Hathaway and Tim Cook’s Apple.

It does not look like that will be changing anytime soon. Apple Pay was designed to solve many of the problems cryptocurrency solves, including slow transactions and difficulty making retail purchases globally. Plus Apple is famous for preferring closed systems. Further, revered Berkshire CEO Warren Buffett has called bitcoin “rat-poison squared,” and in May, his right-hand man Charlie Munger said he “hates” bitcoin’s success, calling it “contrary to the interest of civilization.”

ELSEWHERE

Binace Faces Probe by U.S. Money-Laundering and Tax Sleuths [Bloomberg]

Record Grayscale Discount Might Mean Bargain Bitcoin For Retail Traders [CoinDesk]

Coinbase Says It Will Support More Assets, Including DOGE, After Strong Q1 Earnings [The Block]

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