Tesla CEO, Technoking and self-proclaimed Dogefather Elon Musk asked his vast network of Twitter followers Tuesday if Tesla should accept Dogecoin as payment for the electric vehicles.
Nearly 80% of the close to 4 million people who voted said yes. After the price of Doge plummeted from a high of nearly 74 cents down to around 42 cents after Musk declared the meme crypto “a hustle” on “Saturday Night Live,” the poll may have driven the price back up above the 50-cent mark.
With the rally, Doge’s market cap exceeded $68 billion, making the currency the fourth most valuable cryptocurrency, after Bitcoin, Ethereum and Binance Coin, according to CoinMarketCap statistics.
The poll also sparked a flurry of memes of the Shiba Inu dog driving Teslas, and one user tweeted photo of the famous Tesla S3XY short shorts with the Doge dog edited onto the shorts.
The Biggest Difference Between Bitcoin and Dogecoin
Tesla already announced that it would be accepting Bitcoin as payment for purchase vehicles, but there are several differences between Dogecoin and Bitcoin. The primary difference is that there is no cap on supply of Dogecoin because more can be created and issued at any time. As with physical, or fiat, U.S. currency, printing more can create inflation as the value of the dollar — or the Doge, in this case — drops.
In addition, Bitcoin has a limit of 21 million coins, creating scarcity much like precious metals have. When U.S. dollars were backed by gold in the Federal Reserve bank before 1971, the U.S. dollar also had built-in scarcity. Now the Fed must regulate the printing of money to keep the value of a dollar stable. While the U.S. Federal Reserve ensures that the decision to print more U.S. currency doesn’t cause runaway inflation, Doge is not regulated in this way.
Furtheremore, whereas Bitcoin is well distributed across the world and continues growing in adoption, experts point out on CNBC, one-third of Dogecoin is owned by the engineers who developed it, Galaxy Digital CEO and crypto bull Mike Novogratz told CNBC. “I worry that, once the enthusiasm rolls out, there’s no developers on it, there’s no institutions coming in. But it’s got this moniker of the people’s coin right now … I think it’s dangerous because once that enthusiasm dies, if it dies, you could have a long way down. But I don’t want to discredit.”
Even Musk recommends caution when it comes to cyrypto investments. Prior to his Saturday Night Live appearance, he tweeted, “Cryptocurrency is promising, but please invest with caution!” and issued a similar warning in an interview with TMZ.
How Much Would You Pay for a Tesla Using Crypto Today?
Theoretically speaking, how much would a Model 3 cost if you were to pay with Dogecoin or Bitcoin right now? Based on Coinbase’s listing price of 47 cents for Doge, a base 2021 Tesla Model 3 with an manufacturer’s suggested retail price of $33,190, would cost 70,617 dogecoins. On the other hand, a single bitcoin, worth $55,108.90, could purchase a performance Model Y with a retail price of $54,690 as quoted on the Tesla website.
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This article originally appeared on GOBankingRates.com: Elon Musk Asks: Should Tesla Accept Dogecoin? How Much Would You Need?