exactly a month ago Dogecoin (CCC:DOGE USD) prices shot up after an announcement by Elon Musk. The man hailed as the “dog father” confirmed this Tesla (NASDAQ:TSLA) wanted to start accepting the popular meme coin as payment for company goods. This news sent Dogecoin price skyrocketing as investors pondered what the future held for both the original meme coin and Tesla stock. Today, as we watch Dogecoin prices surge on the first day Tesla accepts them, we have our answer. And while the patterns we’ve seen in Tesla stock haven’t been all that exciting, there’s no reason for investors to worry.
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What is happening to Tesla stock?
The first two weeks of 2022 have been turbulent for the electric vehicle (EV) innovator. Today’s news has not helped in this regard. As of this writing, Tesla stock is down 0.83% for the day and appears poised to close this week on low levels. However, gains it posted a few days ago keep it up 2.4% in the green for the week. Shares remained up almost 7% for the month, fueled by the growth the stock experienced at the start of the new year.
Dogecoin, on the other hand, has responded well to the day’s news. It is currently up almost 9%. Despite its plunge yesterday, the crypto remains more than 24% in the green for the week. Given the plunge Dogecoin experienced on Jan. 10, this is welcome news for investors.
Why it matters
To the untrained eye, this message appears to benefit only one party involved. However, everyone should remember that Tesla stock is grappling with other market forces right now. The general dynamic is not working in his favor today. As was the case yesterday, fellow electric vehicle manufacturers Rivian (NASDAQ:RIVN) and Fisker (NYSE:FSR) have also been watching their stocks fall all day. Additionally, Tesla’s recent decision to delay the launch of its electric Cybertruck is causing a stir among investors.
While EV fans aren’t happy about having to wait another year for the Cybertruck, it shouldn’t worry investors. Musk is known for missing deadlines, but despite it all, Tesla has maintained its place at the forefront of the EV race. And despite the turbulent December, Tesla stock remains more than 57% in the green over the past six months. Investors have plenty to be optimistic about, especially if the company secures its expansion into India. When it comes to bad publicity, there’s a good chance Tesla will shrug it off easily.
While it might not get much coverage, Tesla does offer a fair amount of business-themed merchandise. Now that it accepts DOGE, it has opened up to a new group of buyers. As InvestorPlace’s Joel Baglole recently explained, “A whistle in the shape of Tesla’s Cybertruck costs 300 Dogecoin. At current prices, that’s about $59. A commemorative belt buckle celebrating Tesla’s Gigafactory in Texas can be purchased for 835 DOGE, or about $164.”
What it means for Tesla stock
While merchandise isn’t a significant portion of Tesla’s sales, Dogecoin adoption will only help boost social media traction. Dogecoin is the meme token that started the Pupcoin frenzy – known to be powered by a powerful digital army. When the Dogecoin Army tweets, they can help prices go up. As it looks from here, Tesla is only in for a surge in both merch sales and social media buzz.
Perhaps most importantly, this decision by Tesla helps add further credibility to Dogecoin. Musk tweeted that he owns the crypto, but accepting it as payment shows the meme coin has real-world utility.
At the time of publication, Samuel O’Brien held no position (neither directly nor indirectly) in the securities mentioned in this article. The opinions expressed in this article are those of the author and are subject to InvestorPlace.com’s publicity guidelines.