Elon Musk's AI Firm Hits the Brakes on Dogecoin Rally with Firm Stance on Funding

On Tuesday, DOGE witnessed a significant surge, sparked by revelations in an official filing with the Securities and Exchange Commission (SEC). The document indicated that xAI, the artificial intelligence venture led by Elon Musk, had successfully secured an impressive funding amount of $134.7 million and was contemplating the possibility of raising up to $1 billion in capital.

However, the market dynamics took an unexpected turn in the U.S. morning hours on Wednesday. Elon Musk, the prominent tech entrepreneur deeply involved in the cryptocurrency space, conveyed a contradictory message concerning the financial plans of xAI. Musk stated emphatically that his AI startup was currently 

"not in the process of raising funds."

We are not raising money right now

— Elon Musk (@elonmusk) December 6, 2023

This announcement promptly influenced the trajectory of DOGE, leading to a retreat to $0.10 and marking a 1.1% decline within the past hour. This reversal negated some of the gains from the previous day, when DOGE had undergone a substantial 14% rally.

The initial surge in the value of DOGE transpired on Tuesday following reports from a SEC filing. The filing revealed the intentions of xAI, also legally known as X.AI, to potentially raise a substantial sum of $1 billion, with an already impressive accumulation of $134.7 million.

Historically, DOGE has demonstrated vulnerability to market fluctuations influenced by Elon Musk's statements and social media engagements, reflecting his apparent interest in the meme-inspired cryptocurrency. In April, Musk hinted at the prospect of DOGE payments on X, formerly recognized as Twitter. He suggested dogecoin as one of the payment alternatives for Twitter Blue, the platform's subscription service offering premium features.

It is noteworthy that Musk's electric vehicle company, Tesla, currently accepts DOGE as a payment method for purchasing merchandise in the Tesla Store. This further adds complexity to the intricate relationship between Elon Musk and the dog-themed cryptocurrency.

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