TL;DR Breakdown
- Musk ready to support Dogecoin to get mainstream adoption.
- This would only happen if Dogecoin becomes actually centralized.
The world’s richest man and CEO of Tesla, Elon Musk, has pledged to fully support Dogecoin especially if major holders of the altcoin sell most of their coin. The CEO made this announcement in a Twitter post. He said too much concentration is holding the crypto back from mainstream adoption.
“I will pay actual $ if they just void their account,” Elon Musk tweeted.
Elon Musk’s argument appears to be right as reports state that one entity holds over 27 percent of Dogecoin’s entire market cap, valued at over $7 billion at press time. Similarly, the top 20 DOGE addresses hold over 50 percent of the altcoin’s current circulating supply (over $3.5 billion). The Tesla CEO believes that for Dogecoin to be embraced properly, these hodlers must sell their coin.
What Elon Musk would do if whales don’t sell their holding
The Tesla CEO hinted that if whales and hodlers don’t sell their Dogecoin, he would no longer endorse the crypto. He said this when another Twitter user asked him about the chance of him potentially ceasing support for the coin if whales don’t sell their tokens and continued to hold on, to which he replied “Yup.”
According to Binance CEO, Changpeng Zhao, it is a risk for only 1 address to hold 27 percent of all Doge and 20 addresses holding over 50 percent of all Doge. Changpeng Zhao said that way the crypto is then ‘centralized’ in a sense. It means that when such wallet chooses to sell, the price of Doge would definitely crash.
Some pros/risks of #Doge.
Pros: Cool, fun, PR manager @elonmusk. Decentralized in the sense there are no “core team”. It’s abandoned.
Risks:
1 address holds 27% of all #DOGE.
Top 20 addresses holds more than 50%+ of all #DOGE
Kinda “centralized” in that sense.
“abandoned”.— CZ
Binance (@cz_binance) February 4, 2021
Dogecoin for the people
Previously, Musk described Dogecoin as the peoples’ crypto and said he had bought some for his baby boy. However, it cannot be ascertained if the Tesla CEO meant what he said or was only joking.
Also, uncertainties surround the positives of Musk’s continuous tweeting about Dogecoin. What seems quite certain is that his many tweets about the coin has led to its significantly high volatility which continues to rise daily.
Currently, the fate of Musk’s Dogecoin support lies on the major hodler of the crypto accepting his offer.