Elon Musk is back to tweeting about Bitcoin, Ethereum and Dogecoin.
He did so with a tweet in which he praised Dogecoin which, unlike Bitcoin and Ethereum, does not need a second layer to be scalable, guaranteeing speed and low transaction costs.
In response to pro-Dogecoin YouTuber Matt Wallace, who claimed that with the new update DOGE could become one of the most widely used coins in the world, Elon Musk wrote:
“BTC & ETH are pursuing a multilayer transaction system, but base layer transaction rate is slow & transaction cost is high.
There is merit imo to Doge maximizing base layer transaction rate & minimizing transaction cost with exchanges acting as the de facto secondary layer”.
BTC & ETH are pursuing a multilayer transaction system, but base layer transaction rate is slow & transaction cost is high.
There is merit imo to Doge maximizing base layer transaction rate & minimizing transaction cost with exchanges acting as the de facto secondary layer.
— Elon Musk (@elonmusk) July 9, 2021
In fact, Elon Musk disputes that Bitcoin and Ethereum only work smoothly with a second layer. In the case of Bitcoin, the Lightning Network has become crucial to enable fast transactions, and is increasingly used.
Ethereum also uses second layers (such as Polygon), but with the move to Proof of Stake, Vitalik Buterin aims to make the first layer scalable as well, containing the cost of fees which is currently very high,
Reactions to Elon Musk’s tweet on Dogecoin, Bitcoin and Ethereum
Elon Musk’s tweet has obviously moved the price of Dogecoin, which today has gained 5% and is back at 22 cents. Bitcoin, on the other hand, was not particularly affected by the words of Tesla’s CEO, indeed it gained 1% today, returning to $33,000 after yesterday’s drop. Ethereum, on the other hand, remained in negative territory, losing 3% today and remaining at $2,100.
But what is also striking are the reactions of the community.
Elon Musk’s tweet, which confirmed his support for Dogecoin, was met with an avalanche of criticism.
Peter McCormack‘s reply was meaningful:
— Peter McItsComingHome 🏴 (@PeterMcCormack) July 9, 2021
Basically, McCormack advises Elon Musk to try to go into space by makeshift means, since he seems to want everything at once. Instead, Bitcoin’s structure, while undoubtedly slow, guarantees a lot of security.
Among the many who have pointed out the excellent functioning of layer 2, Calvin Ayre has also pointed out that BSV works very well without second layers, reiterating without saying so, that Bitcoin Satoshi Vision is the real bitcoin.
One thing is clear: it seems that Elon Musk’s tweets no longer have the same effect on the market.