Next Gen Investing

Dogecoin rallies after Elon Musk agrees with Mark Cuban that it's the 'strongest' cryptocurrency as a medium of exchange

Tesla CEO Elon Musk attends an opening ceremony for Tesla China-made Model Y program in Shanghai, east China, Jan. 7, 2020.
Ding Ting | Xinhua News Agency | Getty Images

Meme-inspired cryptocurrency dogecoin surged on Monday morning, hitting 35 cents. It's now trading at around 33 cents and is up 10% in the last 24 hours, according to CoinMarketCap.

This boost came after billionaire investor Mark Cuban told CNBC Make It last week that "the community for doge is the strongest when it comes to using it as a medium of exchange." On Twitter, Elon Musk, CEO of Tesla and SpaceX, said that he agrees.

"I've been saying this for a while," Musk tweeted on Saturday.

In May, Musk tweeted that he has been working with dogecoin developers to "improve system transaction efficiency." Musk also reportedly told a dogecoin developer that his goal is to make dogecoin easy enough to use that investors could use it to pay for a cup of coffee.

"The point is that dogecoin was invented as a joke as essentially to make fun of cryptocurrency," Musk told TMZ in May. "Fate loves irony. What would be the most ironic outcome? The currency that started as a joke in fact becomes the real currency."

Musk consistently supports the dogecoin community. He has tweeted countless dogecoin memes, which have seemingly impacted its price.

Both Musk and Cuban own dogecoin, as well as bitcoin and ether.

However, financial experts are highly skeptical of cryptocurrencies as a whole due to their speculative nature and warn that people should only invest what they can afford to lose. Some experts say to be especially cautious when investing in dogecoin in particular, since it lacks the scarcity and technological development that bitcoin has, for example.

Though dogecoin was created as a joke and its creators never intended for it to be taken seriously, both Musk and Cuban see it as a useful digital currency.

"The point about doge that people miss is that doge's imperfections and simplicity are its greatest strengths," Cuban tweeted on Sunday. "You can only use it to do two things: Spend it or HODL it. Both are easy to understand. And it's cheap to buy. Which makes it a community anyone can join and enjoy."

Sign up now: Get smarter about your money and career with our weekly newsletter

Don't miss:

How altcoins like ether captured more and more of the crypto market
How altcoins like ether captured more and more of the crypto market

Disclosure: CNBC owns the exclusive off-network cable rights to "Shark Tank."