Finance

Elon Musk dogecoin tweets worry bitcoin bulls Carter and Novogratz

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SpaceX owner and Tesla CEO Elon Musk (R) gesticulates when he arrives on the red carpet for the Axel Springer Awards in Berlin on December 1, 2020.

Britta Pedersen | AFP | Getty Images

Tesla CEO Elon Musk and other celebrities have posted several tweets lately supporting Dogecoin – and some in the cryptocurrency world are unimpressed.

Nic Carter, a venture capitalist known for his optimistic stance on Bitcoin, says Musk’s enthusiasm for the meme-inspired digital token is “troubling” as it is used primarily as a “vehicle for speculation.”

“Unfortunately, a lot of retailers will lose money on Dogecoin in the long run because there really isn’t a lot of interesting technology out there,” Carter, co-founder of Castle Island Ventures and data firm Coin Metrics told CNBC’s. Street signs Europe “Wednesday.

“The only thing it can really do is get zombified and stick with it and be an empty shell for people’s expectations and entertainment.”

Carter said Dogecoin introduced it to crypto in 2013, and although it was “entertaining and fun” at the time, it is now “kind of an empty shell”.

According to CoinMarketCap data, Dogecoin was briefly number 10 in virtual currency by market value this week as tweets from icons of the musk and music industry, Snoop Dogg and Gene Simmons, pushed the price to an all-time high.

Dogecoin was developed in 2013 by software engineers Billy Markus and Jackson Palmer and was intended to be used as a faster but “fun” alternative to Bitcoin. It is based on the once popular “Doge” meme, which depicts a Shiba-Inu dog alongside multicolored text in comic-sans script.

After a brief two-day break from Twitter, Musk returned to post several tweets about the Doge Coin, calling it “the people’s crypto”. Musk tweeted again about the token on Wednesday, saying he bought Dogecoin for X Æ A-12, his son with Canadian musician Grimes, “so he can be a toddler hodler.”

Musk allegedly was referring to the bitcoin slang term “HODL” which encourages people to hold onto their crypto instead of selling it.

Carter wasn’t the only Bitcoin enthusiast to criticize Musk for his comments on Dogecoin. Mike Novogratz, Galaxy Digital CEO, said he wished Musk wouldn’t make tweets like this.

“Dogecoin reminds me a lot of GameStop,” Novogratz told CNBC’s “Squawk Box” on Monday.

“It’s a meme,” he said. “It was a bit of fun, but now it’s a market valuation where people are going to lose a lot of money in the Doge.”

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Robert Dunfee