Why Bitcoin and Ethereum Popped, but Dogecoin Dropped

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Motley Fool 22 July, 2021 - 01:12pm 25 views

Does Elon Musk own Bitcoin?

This article is in your queue. Tesla Inc. TSLA -0.92% Chief Executive Elon Musk said Wednesday that he and his rocket company, SpaceX, hold bitcoin, a cryptocurrency he generally supports despite having concerns about its environmental impacts. The Wall Street JournalTesla CEO Elon Musk Says He Personally Owns Bitcoin—and So Does SpaceX

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Has Dogecoin (CRYPTO:DOGE) ever had a better friend that Elon Musk? Well, not today. For months, the Tesla (NASDAQ:TSLA) boss has off-and-on hyped or denigrated the one-time joke cryptocurrency, helping to drive the former sub-$0.01 coin's value past $0.72.

But today, Musk's distraction from Dogecoin may be the reason the price is diving -- and also the reason that Bitcoin (CRYPTO:BTC) and Ethereum (CRYPTO:ETH) are both moving higher.  

To recap, here's how the values stand as of 1:30 p.m. EDT:

So why are Bitcoin and Ethereum outperforming Dogecoin today? Two reasons (and Musk is a part of both).

In the case of Bitcoin, Musk commented today that although he still needs to do "a little bit more due diligence to confirm" this, as soon as he sees that renewable energy is being used for at least 50% of Bitcoin mining, Tesla will "most likely" resume accepting Bitcoin as payment for Tesla electric cars.  

Meanwhile on the subject of Ethereum, Musk confirmed that he personally owns some of that cryptocurrency as well as Bitcoin -- an offhand comment that nonetheless, at one point today, sent Ethereum prices up as much as 12%!  

Here's the thing: At the same "B Word Conference" at which Musk made the comments that are lifting Bitcoin and Ethereum prices today, Musk also confirmed that he owns Dogecoin as well. I suspect that most investors already assumed that, however, given the cryptocurrency's frequent appearance on Musk's Twitter feed.  

In contrast, the revelation about his owning Ethereum, and the confirmation that Bitcoin could soon become legal tender for Tesla-shopping as well, were both "new" news -- and they're moving the cryptocurrency market accordingly.

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