SpaceX owner and Tesla CEO Elon Musk (R) gesticulates as he arrives on the red carpet for the Axel Springer Prize ceremony in Berlin on December 1, 2020.
Britta Pedersen | AFP | Getty Images
Tesla CEO Elon Musk and other celebrities have posted several tweets supporting dogecoin recently – and some in the cryptocurrency world are not impressed.
Nic Carter, a venture capitalist known for his optimistic stance on bitcoin, thinks Musk’s enthusiasm for the meme-inspired digital token is “disconcerting” as it is mainly used as a “vehicle for speculation”.
“Unfortunately, many retail bettors are going to lose money on dogecoin in the long run, because there really isn’t much there in terms of interesting technology,” Carter, co-founder of Castle Island Ventures and data company Coin Metrics, told CNBC’s “Street Signs. Europe “Wednesday.
“The only thing he can really do is be buzzed and stay around and be an empty shell for people’s expectations and for their entertainment.”
Carter said that dogecoin introduced him to cryptography in 2013 and that while it was “fun and entertaining” at the time, it is now “a kind of empty shell”.
Dogecoin was briefly the number 10 virtual currency in market value this week, according to data from CoinMarketCap, while tweets from music industry icons and Musk Snoop Dogg and Gene Simmons raised their price to a historic peak.
Created in 2013 by software engineers Billy Markus and Jackson Palmer, dogecoin was designed to be used as a faster – but “fun” alternative to bitcoin. It is based on the once popular meme “doge”, which depicts a shiba inu dog alongside multicolored text in the comic sans font.
After a brief two-day break on Twitter, Musk went back to making several tweets about dogecoin, calling it “the cryptography of the people”.
Carter was not the only bitcoin enthusiast to criticize Musk for his comments on dogecoin. Mike Novogratz, CEO of Galaxy Digital, said he would like Musk not to do such tweets.
“Dogecoin reminds me a lot of GameStop,” Novogratz told CNBC’s “Squawk Box” on Monday, referring to the video game retailer who saw his stocks fluctuate violently after members of a Reddit board piled up the heavily sold shares.
“It’s a meme,” he said. “It was funny for a while, but now it’s in a market assessment where people are going to lose a lot of money on Doge.”
“Bitcoin has a real purpose, Etheruem has a real purpose, many of the stablecoins have a real purpose,” added Novogratz. “Doge is a kind of meme, a kind of joke.”
The former hedge fund manager compared Musk’s comments about dogecoin with his infamous “guaranteed financing” tweet in 2018, where he claimed he was considering closing Tesla for $ 420. Musk agreed to pay a fine and stepped down as Tesla chairman to make an agreement with the United States Securities and Exchange Commission on the matter.
Tesla revealed a $ 1.5 billion investment in bitcoin on Monday, in a news story that raised the price of the world’s most valuable cryptocurrency to a record high and led to speculation about whether more big corporations would do the same.
Carter said that while he found the company’s purchase of bitcoin “interesting”, he is not advising the companies he invested in to do the same.
“I don’t put my startups’ assets in bitcoin and, frankly, I don’t necessarily think that’s the most prudent approach for a CFO,” he said.