Dogecoin sinks as Elon Musk calls it ‘a hustle’ on SNL

Jeremy Welch, Kraken's Chief Product Officer, joined Yahoo Finance to discuss the outlook for crypto and Dogecoin after Elon Musk calls it ‘a hustle’ on SNL.

Video transcript

SEANA SMITH: The CEO Elon Musk, those comments that he made on SNL over the weekend sent the price of Dogecoin plummeting yesterday. It's down just around 23% right now. We want to talk about this. And with that, we want to bring in Jeremy Welsh. He's Kraken's chief product officer. And Jeremy, when we know-- we know Dogecoin, obviously, has been extremely volatile, especially over the last several weeks. Today, we're seeing a massive move to the downside, off more than 20%. What do you think of the move?

JEREMY WELSH: Well, I think this is just part of the story of cryptocurrency's adoption, right? So cryptocurrencies have moved a lot as they've been adopted. And this is really a really big impact point with cryptocurrency mentioned in a really big way on Saturday Night Live. And so, despite the moves, you know, I think Elon is probably still excited. He's shown a lot more excitement around cryptocurrencies generally, including with Tesla buying into Bitcoin and having it on the balance sheet. So this is just part of, again, the wider story of cryptocurrencies really hitting this mainstream adoption.

ADAM SHAPIRO: But how do you, on one hand, take the joking about it being a hustle and then SpaceX will accept Dogecoin as payment for Doge 1 mission to the moon. I mean, at what point do people take this seriously? Is really anybody going to do this? Or am I missing a joke here because I'm over 50?

JEREMY WELSH: Well, Elon has always been kind of mysterious. With the mix of his tweets, the way he's running his companies, and the way that he's, again, presented himself, he's always been a little bit of an enigma. And he's created an incredible amount of value. I think the one thing is value is value. And right now, with Dogecoin, you've got a lot of community buy-in, a lot of excitement around it. And you have a lot of buying around cryptocurrencies generally again, as it gets closer and closer to a really wide adoption.

You've got banks that are going to start supporting cryptocurrencies in a wider way this year. And so, again, overall, I think this is just representative of the adoption. And for Elon, again, he's always been a little bit of an enigma character. So the fact that he's joking about it on the one hand, and then on the other hand, he's accepting it for a rocket to the moon, is just a testament to him and, again, to his belief in the cryptocurrencies generally.

SEANA SMITH: Well, Jeremy, what about the fact, though, that people are saying this is a joke? The wild swings that we've seen in Dogecoin is taking away from the realness or the seriousness of some of the other cryptocurrencies like Bitcoin or like Ethereum. I guess, where do you stand on that?

JEREMY WELSH: Look, if you compare-- I mean, I think Elon Musk, despite the fact that he's enjoying Dogecoin and he's enjoying it with the community, he's had more impact on the space by exposing with Tesla, by exposing Bitcoin on the balance sheet. He's potentially had more impact than anybody else in the world because now you have Bitcoin exposure to investors at S&P 500 to a very wide investor base. They're now getting exposure to this asset, which has been called the digital gold. It has a-- it's revolutionary in terms of its technology.

But it's only just starting to get wide acceptance. And I wouldn't be surprised if we see many more companies on the S&P 500 also added to the balance sheet over time. But it is, again, Elon has his mysterious ways. And so he's balanced, on the one hand, making these really big moves and these really big impacts with also really relishing and enjoying in the community aspect of this and the fun of it with Dogecoin and some of the memes.

ADAM SHAPIRO: So Jeremy, what happens? At the top of this hour, we spoke to an analyst who said people who say that Bitcoin and cryptocurrencies, there's no fear of government regulation because money launderers and the cyber thieves who are holding up the pipeline, the Colonial Pipeline, you know, it's not an issue. Said that's rubbish, it absolutely is an issue, and there's a need for the government to regulate crypto because of that. What happens to the trading if governments, whether it's right or wrong, do begin to regulate?

JEREMY WELSH: Look, it's going to be a natural thing for governments to get more involved and adapt their laws to cryptocurrencies. Cryptocurrencies do represent new types of technology, any type of new technology we've seen changing laws or on any type of new technology. It's been the case with the internet when the internet rolled out. It was also the case with automobiles, right, long ago. So we will have more laws and regulations over time. And that's OK. That's an OK thing. We've been working-- at Kraken, we just announced last year. We just got a new type of bank charter, the SPY Bank charter.

So there's a lot of innovation in ways it can happen with the government and with new laws and adapting laws. And we're really excited about that. But the scale that we're going to see, as we transition to the mainstream, you know, there's no doubt that there's going to have to be some involvement from the government. And we've been excited, again, to work with the Wyoming bank charters at SPDI and others to make sure that the way that they're adapting these laws is favorable to take advantage of a lot of the benefits that are coming from these open systems, like Bitcoin and Ethereum and other cryptocurrencies.

SEANA SMITH: Jeremy Welsh, Kraken's chief product officer, thanks so much for taking the time.