Elon Musk has put an end to rumours that the US government is planning to use Dogecoin ($DOGE). Speaking at an America PAC town hall in Green Bay, Wisconsin, he made it clear that there are no such plans.
“There are no plans for the government to use Dogecoin or anything, as far as I know”, Musk said.
The confusion started because of the Department of Government Efficiency (DOGE), a government project that Musk is leading. The name of the department happens to share an acronym with Dogecoin, the popular cryptocurrency that Musk has supported in the past.
However, Musk made it clear that DOGE has nothing to do with Dogecoin. Instead, it is focused on making the government work more efficiently and cutting unnecessary spending. This statement comes after weeks of speculation linking Dogecoin to government operations.
Some people assumed that because Musk is leading the DOGE initiative, it must be connected to the cryptocurrency.
But Musk dismissed these claims, saying that the project is about reducing costs, not introducing digital currencies into government operations.
Government efficiency initiative: What is it about?
The Department of Government Efficiency (DOGE) was created by President Donald Trump with a clear goal: to make government operations 15% more efficient.
Trump appointed Musk to lead the initiative, giving him the task of reducing wasteful government spending and improving efficiency.
Musk initially planned to name the project the Government Efficiency Commission but later changed it after listening to public feedback. “I was going to call it the Government Efficiency Commission, but that’s a super boring name”, Musk said. The new name, Department of Government Efficiency (DOGE), was seen as more engaging.
The project has already taken steps to cut costs. One of its most significant discoveries was that the government had issued 4.6 million credit cards to federal employees, even though there are only 2.3 to 2.4 million government workers.
Musk called this situation “absurd” and immediately ordered reductions in the number of government-issued credit cards.
However, the initiative has not been without controversy. While some people support the cost-cutting measures, others criticise the project for operating without enough oversight.
Critics argue that some government programs have been cut too aggressively and that decisions are being made without proper review.
Despite these concerns, Musk remains confident in the initiative’s goals. He has stated that he plans to step down from his role in the Trump administration once the initiative has achieved its goal of cutting $1 trillion from the federal deficit.
According to him, this could be accomplished within 130 days, meaning he may leave his position by May.
Market’s reaction to Musk’s statement
After Musk’s clarification, Dogecoin’s price remained largely unchanged. Unlike past instances where Musk’s comments led to big swings in the cryptocurrency’s price, this time, the market reaction was muted.
Currently, Dogecoin is priced at $0.17, with a market capitalisation of $24.78 billion. The cryptocurrency’s trading volume has dropped by 15.55% in the past 24 hours, and it has experienced a 3.06% decrease in the last day and a 4.63% drop over the past week.
This reaction is different from what happened earlier this year. In February, the official website of the Department of Government Efficiency briefly displayed Dogecoin’s Shiba Inu mascot.
This caused a surge in speculation that the government was planning to use Dogecoin, leading to a 14% increase in the coin’s price. However, the website quickly removed the image, and the rumours eventually faded.
Some analysts are optimistic about Dogecoin’s future despite its recent decline. Crypto traders have identified a trendline breakout, suggesting that Dogecoin could rally toward $0.89 if certain resistance levels are overcome. However, there are also concerns about liquidation risks if the price falls below $0.175.
One trader recently wrote on social media that Dogecoin is ready for an upward rally and could soon reach new highs. Another analyst, Ali Martinez, noted that investor anxiety is increasing, which often leads to price volatility.
However, not everyone is convinced. Some analysts warn that Dogecoin could experience further declines due to the large number of liquidations stacked below the $0.175 level.
Others point out that while Dogecoin has had strong rallies in previous years, there are no guarantees that history will repeat itself.
Musk’s role and the future of the DOGE initiative
Musk has made it clear that he is not being paid for his work with the Department of Government Efficiency. However, his exact role within the Trump administration remains somewhat unclear.
The White House has described Musk as a senior advisor with no direct policy authority. However, Trump himself has referred to him as the leader of the department. This contradiction has led to some confusion over how much control Musk actually has over government spending decisions.
Meanwhile, the DOGE initiative has faced legal challenges. Several lawsuits have been filed in an attempt to limit its power, with critics arguing that it is cutting too many government programs too quickly.
Some of the agencies affected include the Consumer Financial Protection Bureau (CFPB), the Social Security Administration (SSA), and the US Agency for International Development (USAID).
Musk, however, has dismissed concerns, stating that all decisions are made carefully and adjusted when necessary. He also responded to media criticism, saying, “We need to get attention. Somewhat inevitably, when I do these things, it causes the legacy media to kind of lose their minds”.
While the DOGE initiative continues to reshape government spending, Musk’s latest comments make it clear that Dogecoin remains separate from any official government projects.
As speculation dies down, investors and analysts will likely shift their focus back to Dogecoin’s independent market performance.
What’s next for Dogecoin?
The recent clarification from Musk has helped separate the DOGE government initiative from the Dogecoin cryptocurrency. Despite the similar names, Musk has made it clear that the two are completely unrelated.
In the short term, Dogecoin’s price remains under pressure, with analysts closely watching key support and resistance levels. If the price breaks above $0.185, some traders believe it could see a strong upward movement. However, if it falls below $0.175, liquidation risks could push the price lower.
Long-term predictions for Dogecoin vary widely. Some analysts believe that based on historical cycles, Dogecoin could see a major rally in the coming years.
A trader even predicted that Dogecoin could reach $11.71 by the end of 2025. However, such forecasts remain highly speculative.
For now, the focus remains on Musk’s government efficiency initiative and its impact on federal spending. As the DOGE project moves forward, Musk’s role in government operations will continue to be closely watched.
