Tesla CEO and multi-technology business leader Elon Musk announced this week that he will officially reduce his involvement in the U.S. federal government’s Department of Government Efficiency (DOGE) starting in May 2025, and that he will continue to work with the U.S. federal government on a variety of initiatives. (DOGE) from May 2025. This decision immediately triggered widespread concern in the tech community, political circles, and cryptocurrency investor groups, especially regarding the future of the dog coin (Dogecoin, referred to as DOGE) has become the focus of market discussion.
Musk adjusts positions to focus on Tesla
In Tesla’s first-quarter earnings report released this month, the company’s profit fell 71% year-on-year, and revenue shrank sharply, with the main reason cited as the result of fierce competition in the global electric car market, tight battery supply, and declining sales in North America. In a subsequent conference call, Musk made it clear: “Starting next month, I will be reallocating more of my energy to Tesla, working on company operations and technology updates.”
At the same time, Musk revealed that he will gradually withdraw from the implementation of the “Government Efficiency Department” with the support of President Trump, and will only retain the role of “senior advisor” to provide strategic guidance to the department.
“The Department of Governmental Efficiency is a special agency created by President Trump in early 2025 to improve the overall efficiency of the U.S. government by eliminating redundant federal positions, reducing budget deficits, and compressing the budgets of inefficient programs. As a symbolic figure in the early days of the department, Musk was actively involved in implementing a series of radical reforms such as streamlining the federal structure, weakening the Diversity, Equity, and Inclusion (DEI) program, and promoting digital processes.
However, as the policies have been implemented, the controversy over Musk’s efficiency reforms has been heating up. Supporters believe that its reform is effective, while critics accuse it of laying off employees too quickly and lacking humanistic considerations.
Will Dogcoin’s fate be ‘cold turkey’?
In addition to the impact on Tesla and the political establishment, Musk’s move has been widely interpreted as a weakening of his influence in the cryptocurrency space, particularly Dogecoin (DOGE).
As the most famous “unofficial spokesperson” for Dogcoin, Musk has continued to promote DOGE on Twitter (now Platform X) since 2020 in humorous, flirtatious, playful, and even serious tones, and has called himself the “Godfather of Dogcoin” on the TV show “Saturday Night Live! “. His every move often has a direct impact on the rise and fall of the price of dogcoin, and even triggers coin market shocks in the short term.
Currently, Dogcoin remains among the top 10 cryptocurrencies in the world by market capitalization. According to CoinMarketCap data, DOGE price rose 3.93% in the 24 hours after Musk’s announcement to reduce his government duties, and is currently at $0.1836. But several analysts pointed out that this rally is more like short-term speculation, “the market needs not mood swings, but substantial support.”
How do investors interpret this “persona shift”?
For the subsequent relationship between Musk and DOGE, there is a view that although he has not explicitly withdrawn from the support of the dog coin, from the movement of his adjustment of the distribution of energy, “Musk’s attention to the dog coin is likely to gradually weaken”.
Rachel Pence, an analyst at cryptocurrency analyst Messari Research, said, “Musk has been a strong driver of DOGE in the past because he has a trinity of time, energy, and influence. No, when he shifts those resources more toward Tesla, DOGE may have lost a big core support.”
However, some analysts disagree. Alex Yu, a blockchain project consultant, said, “Musk may reduce his involvement in the government sector, but that doesn’t mean he’ll completely abandon Dogcoin.DOGE has been deeply integrated into his brand image. For example, some of Tesla’s peripheral merchandise accepts DOGE payments, and SpaceX’s
‘Doge-1 satellite program ‘ remains in place.”
Internal pressure on Tesla is also intensifying
On the other hand, Musk’s increased focus on Tesla also reflects his attempts to meet the huge challenges posed by external competition. Over the past year, Chinese EV makers BYD, Xiaopeng, and Ideal have outperformed in terms of technology updates and price control, creating strong competition for Tesla. Meanwhile, continued changes in the policy of subsidizing the purchase of electric vehicles by local U.S. consumers have also brought uncertainty to Tesla’s sales.
It is widely expected that Musk will push Tesla to launch the fully automated driving FSD function faster, restart the “Model 2” economic model program, and strengthen the layout of production capacity outside of North America, to revitalize investor confidence.
Summing up: Musk’s change of identity has far-reaching implications
Musk’s multiple roles as a tech entrepreneur, space exploration pioneer, social media platform owner, and government reformer once made him one of the most talked-about “surreal figures” of the digital age. But this job change shows that even Musk needs to make strategic choices with limited resources.
For Dogecoin, Musk’s “retreat to the background” does not mean a complete decoupling. But it is foreseeable that as his focus returns to Tesla and reduces his “playful intervention”, the cryptocurrency market will gradually return to rationality. If investors continue to take their influence as the core basis for investment, they need to re-examine the true value logic and long-term development potential of cryptocurrencies.
Whether DOGE can go farther without the “Godfather of Dogs” will be a test of its community strength, ecological construction, and the confidence and self-discipline of the market itself.
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