“There is merit [in my opinion] to doge maximizing base layer transaction rate and minimizing transaction cost with exchanges acting as the de facto secondary layer,” Musk said via Twitter, replying to dogecoin investor and YouTuber Matt Wallace.
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“[Bitcoin and ethereum] are pursuing a multilayer transaction system, but base layer transaction rate is slow and transaction cost is high,” Musk added.
It’s hoped that bitcoin, via its payments-focused lightning network and a recent upgrade called taproot, will be able to resolve some of its scaling issues, while etheruem, the second-largest cryptocurrency after bitcoin, is in the midst of a long-awaited upgrade that’s not expected to be completed for years.
Musk was replying to a tweet by Wallace that claimed “the dogecoin update is coming soon,” and that it “will position doge perfectly to become one of the most used currencies in the world.”
In May, Musk proposed a dogecoin upgrade that he claimed is “needed [for dogecoin] to become the currency of Earth” and beat bitcoin “hands down.”
The dogecoin price has surged this year, initially riding January’s meme stock wave but subsequently developing a haphazard community somewhat led by Musk who envision it eventually competing with the likes of bitcoin and ethereum.
Musk, whose irreverent attitude to bitcoin and cryptocurrencies on Twitter has alienated much of the bitcoin community, has previously said all of his dogecoin related comments shouldn’t be taken seriously but has since ramped up his support of it—issuing calls for developer support and promising to put a “literal dogecoin on the literal moon” via his rocket company SpaceX.
Tesla continues to hold the more than $1 billion worth of bitcoin it bought near the beginning of the year—though that investment is now thought to be underwater—but Musk has also indicated he personally holds dogecoin.