The price of a Dogecoin spiked more than 34 percent on Friday after Tesla CEO Elon Musk, a fan of the meme token, tweeted that he was “working with Doge devs to improve system transaction efficiency” and that the work was “potentially promising.”
Dogecoin also got a boost after U.S. crypto exchange Coinbase CEO Brian Armstrong announced that it will allow trading of the coin in the next four-to-six weeks. Coinbase listing announcements have proven to boost the price of cryptocurrencies, according to a March 31 report by Messari, Decrypt reported. More often than not, these lead to a boost in asset returns.
Now the third-richest man in the world, Musk has been accused of being a market manipulator. He’s said in the past that he does not respect the Securities and Exchange Commission, which fined him $20 million and made him step down as Tesla’s chairman over fraud charges in 2018.
Created as a joke token in 2013, Dogecoin was a tribute to the Shiba Inu “Doge” meme and parodied the inherent absurdity of some aspects of crypto culture, Decrypt reported. It was priced at less than a penny for years, often used as tips or to funnel funds to charities.
Dogecoin is now the fourth-largest cryptocurrency by market cap, according to Coinbase. The crypto has risen more than 1,500 percent since the beginning of 2021 with Musk’s help. After Musk’s tweet Thursday, the coin added $10 billion+ to its market cap, which is now at about $68.4 billion. Dogecoin was trading at $0.53 as of this writing.
Some Twitter users were incredulous about Musk’s “working with Doge devs” tweet.
“lol guys there is no dogecoin development and no dogecoin devs,” Brandon Curtis @bcmakes tweeted. “doesn’t have segwit, doesn’t have opcodes added to bitcoin a million years ago. nothing but faffing around with some URLS and the README in years.”
Musk’s ability to move markets with his tweets prompted Twitter user Quad Five Dave @dapstats to call for an SEC investigation.
“So @elonmusk says #dogecoin is a hustle on @nbcsnl, drives price down. Today @elonmusk pumps $doge by >20%. HEY @SEC_ENFORCEMENT HOW BOUT YOU START DOING YOUR JOB”.
“Elon Musk tweets like a man that is doing private and public work for the US GOV. He’s not worried about criminal prosecution for market manipulation,” The Moguldom Nation CEO @JamarlinMartin tweeted.
“with these tweets @elonmusk is forcing SEC’s hand over regulation in crypto space,” KKW @Thekkw tweeted. “can’t think this can go on for long. lol he is moving billions with these tweets, must be nice feeling… Master of Coin”.
Musk has said in the past that his Dogecoin tweets shouldn’t be taken seriously, but not everyone is laughing.
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Demetri Kofinas @kofinas tweeted that Musk is making “a mockery of corporate governance” and operating “without any sense of personal integrity or accountability. He sets a horrible example. The sooner he is exposed for what he is, the better off we will all be.”
Just one person holds almost 30 percent of the total supply of Dogecoin — nearly 37 billion of the 127 billion coins in circulation, Prospect reported in February. That’s more than five times the No. 2 owner.
The SEC doesn’t consider the meme-based Dogecoin to be security, so an investigation into market manipulation would seem unlikely, Kevin Reynolds wrote for Coindesk in February. “However, because the SEC is known to be monitoring Musk’s social media output as part of a settlement of charges that he’d committed securities fraud for misleading tweets, it’s not out of the question.”