An interesting phenomenon. Elon Musk recently announced that X Money will go live next month, and Dogecoin immediately rebounded. Although the increase wasn’t large, this reflexive reaction has already become standard practice. Honestly, this time might be a false alarm, because X Money is essentially a fiat payment tool, more like a copy of Venmo, and has nothing to do with crypto.

The X Money features that Musk announced are pretty comprehensive: P2P transfers, bank deposits, debit cards, cash-back rewards, and a partnership with Visa—already licensed in more than 40 U.S. states. This combo really has strength. But the key is that 6% yield rate, and that’s the point truly worth paying attention to.

A 6% annualized return on a social platform with hundreds of millions of users is higher than most U.S. bank deposit accounts, and can even compete with money market funds. The question is: where does this yield come from? Is it subsidized by Elon Musk’s platform to attract users, generated through lending, or some other mechanism? That’s a big issue for regulators.

Coincidentally, Congress is now discussing the CLARITY Act, which is aimed at stablecoin products that offer yields. The Senate Banking Committee is expected to begin reviewing it in mid to late March. The core question is: can non-bank platforms provide consumers with returns similar to deposits? Here’s a touch of irony—although X Money isn’t a stablecoin product, it targets the same consumer demand: users want higher returns than banks. If X Money launches on a large scale before the CLARITY Act passes, that would be awkward—a fiat product inside a social media app offering yield levels that stablecoins are restricted from providing.

As for Dogecoin, the current market is up +0.77%, with the price at $0.09. Although Musk has always said Dogecoin is his favorite cryptocurrency, and Tesla accepted DOGE payments in 2022, there’s no sign of any crypto integration in X Money’s development direction this time. Musk did retweet a third-party forecast that mentioned “crypto integration,” but the company hasn’t officially confirmed it yet.

Another interesting background is Bhutan’s Bitcoin activity. The country quietly sold about 70% of the Bitcoin it held, dropping from more than 13,000 coins in October last year to 3,954 coins now, worth approximately $280.6 million. Even more interesting is that Bhutan’s earlier Bitcoin mining project, driven by hydropower, also seems to have slowed down—after more than a year, there haven’t been any major new inflows. This may reflect some countries adjusting their crypto-asset allocation strategies.