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Elon Musk has been pushing a meme coin as of late and has even mentioned selling Tesla’s for them. Are we really going to buy a car with Dogecoin?
What is Up with Dogecoin?
If you haven’t heard about “Dogecoin to the moon” in the past months, it’s time to come out from under your rock. This meme of a cryptocurrency had a large surge in popularity as it went up in price to the delight of people who hoarded millions of the coin in their virtual wallets. One of the most vocal truthers of Dogecoin (and possibly the one who gained the most profit) is Tesla’s own, Elon Musk.
Elon has been tweeting to his followers his support for Dogecoin and how it’s the currency of the future. Every tweet from the Tesla founder’s Twitter account mentioning Dogecoin correlated in a spike in the cryptocurrencies value early on. He even doubled down on his belief in the coin by fully funding a SpaceX mission for a ship named “DOGE-1”.
Honestly, it’s a little too much fanfare for a cryptocurrency that’s been a pretty volatile currency as of late, especially when Elon Musk bombed on Saturday Night Live. So, we have to wonder if Tesla planning to accept Dogecoin as payment is a good idea. They only recently started to take Bitcoin, the original cryptocurrency, as payment, but is it worth it to them to take on this meme coin on as payment? We’re all entering a strange point in the world of finance and automotive purchasing, so let’s look at the impact of cryptocurrencies being accepted as car payments and why stuff is only going to get stranger.
Are Cryptocurrencies the Future of Car Sales?
I remember when Bitcoin hit its first record highs, some small dealerships started to try and accept payments of the cryptocurrency hoping it’d only continue to trend upwards. If they were able to sell off some of their used car inventory and hold those today, they’ve seen a massive return on their investment. Is this meteoric rise in price the future of Dogecoin as well? Only time will tell.
For now, Tesla has started to take Bitcoin on as an option to purchase one of their Model 3, Model S, Model X, or Model Y electric vehicles, but it isn’t made easy. Currently, if you want to make a purchase of one of Tesla’s vehicles, you have to make the purchase within 30 minutes. Because of the volatility of crypto prices, Tesla can only give you a price on their vehicle based on the real time market price. Plus, there isn’t any discount for purchasing a Tesla this way, it’s just “cool”.
Tesla also states that if you do not input the correct Bitcoin address when making the transfer, you’re out of luck. There are no reimbursements, no reverses, and it’s not their problem if you mess up. If you do manage to throw down some Bitcoin in those 30 minutes correctly though, you’re then all squared away – almost. The government is going to want its piece of the pie, even if it is with cryptocurrency. Be prepared to configure that Bitcoin sale into your income taxes next year, or your Tesla purchase may be more of a hassle than you intended.
Following what we know about their Bitcoin strategy, it is kind of strange the Tesla has publicly chosen Dogecoin as their next potential choice for Tesla payments (at least their founder has). Sure, Elon founded the company and he’s obviously got some deep ties to the crypto in his own virtual wallet, but there are other successful coins out there they could announce as alternative sources. Litecoin, Ethereum, and Maker all have seen their own significant rises in price and popularity, while also being just as volatile. The only thing Dogecoin really beats them at is the meme picture of a Shiba Inu attached to it.
There is also the problem with the creation of cryptocurrencies. Minting new coins takes time, complex calculations, and tons of energy. They’re terrible for the environment since the GPUs that work on crypto mining take way too much power and aren’t very efficient. That puts a bad light on Tesla who has taken a stand against fossil fuels with their EVs (even with some of the process to create their batteries not being much better). When the environmental impact came to light for current and potential customer, Tesla put a hold on their Bitcoin operation in favor of less impactful coin options in the meantime.
So, will we see more manufacturers and dealerships accept cryptocurrencies like Bitcoin and Dogecoin for the purchase of a vehicle? Probably not until a better purchase method is thought out or how to make crypto mining less of an environmental issue. Apparently, that second one is already being thought out by the crypto community and Elon Musk.
“Fixing” Cryptocurrency Mining
Including the crypto mining methods in Tesla vehicles or charging stations and the creation of a hot tub that runs off of the heat of mining GPUs have been put on the potential list of fixes for crypto miners. The inclusion of mining technology in Tesla vehicle resources is comprised of fan speculation for the most part, but the hot tub is a different story. Elon Musk has shown his approval for the potential for a hot tub that’s heated with the help of mining and has already shown his support for a working one that has been created.
Is this going to flip the script on environmental impacts from mining? Not really. But Tesla does also produce solar panels, so maybe we can harness the power of the sun to help us purchase our very own Tesla Model X or the eventual Cyber Truck. Until then, we’ll just have to keep watching the prices rise and fall as crypto mining practices continue to evolve for both Bitcoin and Dogecoin.
