Musk’s American Party to Accept Bitcoin, Spurs DOGE Rally
On July 5, 2024, Elon Musk announced the formation of the American Party and registered with the Federal Election Commission to accept Bitcoin donations under FEC rules, converting contributions to US dollars within ten days. While the party has yet to issue its own token, traders and investors anticipate Dogecoin (DOGE) could serve as a symbolic fundraising coin given Musk’s history of driving DOGE price rallies after public endorsements.
The announcement coincided with a surge in Solana-based memecoins, where an American Party-themed token rose over 150%, briefly reaching a $10 million market cap. This move marks the first major US political entity to embrace cryptocurrency donations since FEC approval of crypto funding in 2014. Short-term, markets may see heightened speculative trading in Bitcoin, DOGE and other memecoins. Long-term, increased regulatory scrutiny on crypto fundraising is likely as traditional and decentralized political financing converges.
Bullish
The news that Musk’s American Party will accept Bitcoin and potentially use Dogecoin as a fundraising tool is bullish for DOGE and memecoins. Historically, Musk endorsements drive rapid price rallies in DOGE, and the formal political backing signals increased mainstream adoption. In the short term, speculative trading in DOGE and related memecoins is likely to spike. Over the long term, while regulatory scrutiny may rise, validation from a high-profile political initiative could sustain positive sentiment and market demand.