- Being inflationary encourages people to spend Dogecoin, making it a better transaction currency, said Elon Musk.
- DOGE price meanwhile is still down 78% from it’s all-time high.
- Bitcoin, according to Tesla CEO, is more suitable as a store of value and that’s why investors prefer to “HODL” it.
Tesla’s Chief Executive Officer continues to promote Dogecoin (DOGE) and this time his argument towards the meme-coin is that it is a much better option as a currency than Bitcoin.
In an interview with Time Magazine, shortly after being named Time’s 2021 Person of the Year, Musk said DOGE is good for everyday payments.
“Bitcoin is not a good substitute for transactional currency. Even though it was created as a silly joke, Dogecoin is better suited for transactions. The total transaction flow that you do with Dogecoin, like transactions per day, has a much higher potential than Bitcoin,” Musk said.
Dogecoin is a $21.7 billion cryptocurrency trading just above $0.16, down about 78% from its all-time high hit in early May.
Just last week, Musk took to Twitter to announce that the electric car maker will accept DOGE for its merchandise. The news sent the price of DOGE up by about 35% in a matter of a couple of hours.
Popular Among Billionaires
Back in March, this year, billionaire Mark Cuban’s American professional basketball team Dallas Mavericks also started accepting DOGE for tickets and merch through BitPay and reported a 550% increase in DOGE payments in the following month.
Bitcoin, which has a market cap of $870 billion, meanwhile, according to Musk is more suitable as a store of value, and as such investors prefer to “HODL” it than using it for payments.
“The transaction volume of Bitcoin is low, and the cost per transaction is high,” he said.
When it comes to Dogecoin, it is not that good a store of value, as the memecoin is “slightly inflationary” but that “encourages people to spend, rather than sort of hoard as a store of value,” said Musk.
Bitcoin has a fixed supply of 21 million while Dogecoin has an inflation rate of 3.8%, with 5 billion DOGE being added to its supply each year, which could encourage people to spend them instead of hoarding.