The cryptocurrency Dogecoin, named after a popular dog meme, hit a new high on Friday afternoon. It now has a market valuation of over $ 92 billion after a six-month profit of more than 26,000 percent.
The S&P 500 rose 19 percent during that time, while Bitcoin (and Ether) rose 286 percent and 698 percent, respectively, according to CoinMarketCap. And what about Tesla, the darling of the stock market? Since November it is up 56%.
This time around, Wall Street is the joke, according to Mati Greenspan (portfolio manager and inventor of Quantum Economics). “You have TikTok users who outperform smart suits by thousands and thousands of percentage points.”
The satirical cryptocurrency was created by two software developers, Jackson Palmer and Billy Markus, to counterfeit Bitcoin and other cryptocurrencies to overthrow the world.
It was named after Shiba Inu’s popular “doge” meme and pronounced “doje coins” with a soft “g”. What’s the point of that? To be a “fun” alternative to Bitcoin that is faster.
Dogecoin’s success is also due in part to the boom in new Memecoin and Doge Fork projects. Many wanted to invest in the next “Dogecoin”, which has led to an increase in the project success of sub-cryptos, which are having great success in the markets. These include Shiba Inu, Baby Doge, Dogemama, and more.
Dogemama is the youngest Dogecoin kid to make strides in the market. It realizes a model that allows users to earn passive Dogecoin, Shiba and other memecoins by wagering Dogemama coins. It’s an offshoot of Dogemama that claims to be more eco-friendly than Dogecoin.
In a customer note dated May 4, Galaxy researchers Alex Thorn and Karim Helmy emphasized that “Dogecoin has always been charmed by its honesty.” “Unlike other cryptocurrency projects, Dogecoin doesn’t have a big vision or explanation about how it would change the world.
Bitcoin’s offer is also limited to 21 million coins. However, the current limit on the number of Dogecoins to be minted has not yet been reached.
Bitcoin’s value proposition, according to Greenspan, is digital scarcity. According to him, it will only be 21 million. “There’s no hard cap on Dogecoin and it has an outrageous inflation plan.”
The Elon Musk Effect
It’s unclear why Elon Musk loves Dogecoin so much. Elon Musk, CEO of Tesla and SpaceX, a millionaire, spent years promoting the token. Musk’s tweets, which occasionally give a weird reference to Dogecoin, often lead to price records. These contributions also aroused the curiosity of the regular investors. Asheesh Birla is the general manager of Ripple, a company that operates a payment alternative cryptocurrency.
Musk isn’t the only celebrity to support the animal-themed cryptocurrency. Mark Cuban, the owner of the Dallas Mavericks, Snoop Dogg, and Gene Simmons, the bassist for Kiss, have all openly endorsed Dogecoin. Slim Jim, a beef jerky company, joined in the fun. An analyst blamed Elon Musk’s appearance on Saturday Night Live on May 8 for the price hike. It even knocked Robinhood’s trading app down for a brief moment. Dogecoin’s record-breaking price hike isn’t just due to celebrity support. The market was also well positioned. Several rounds of stimulus payments have given people extra money to spend. Day trading has become popular thanks to Robinhood and other apps. It is also possible to “glue” it when you set it up.
Dogecoin is a massive FU for this system, according to Avi Felman, Head of Trading at BlockTower Capital. It’s like, “Yes, indeed! I’ll buy it because I want it,” says the buyer. Experts compare the current situation with the GameStop trading frenzy earlier this year. “Elon says, ‘Why can’t’ Dogecoin have no value? ‘” Felman explained. It’s all part of the GameStop craze. These storylines are highly valued by the general public. These are familiar stories. They like these jokes a lot. Every retail investor’s imagination has been caught by Dogecoin. “
With the increase in commission-free trading through online brokerage apps like Robinhood, people can now invest in cryptocurrency more easily than ever. Doge evangelists have a “rabid online church,” according to Birla. They meet on Reddit and Twitter to discuss how to pump Dogecoin.
Appreciation of Dogecoin
The value of Dogecoin is a controversial issue. At the moment the token has few uses. More and more merchants are accepting Dogecoin as a means of payment. However, it doesn’t have the same level of acceptance as other currencies. “It’s just a big marketing ploy these days,” said Mike Bucella, general partner at BlockTower Capital. Dogecoin is not like other cryptocurrencies like Ethereum that allow programmers to create credit and credit applications on the network.
Dogecoin isn’t exactly a reliable store of value as it usually requires long-term trust in the coin and the blockchain on which it is based. “I don’t know if anyone has added new features or codes to the Dogecoin protocol as a whole in the past few years,” noted Birla. “There is no special development team for Dogecoin.” Because of these restrictions, the Dogecoin rally appears to be completely speculative. The value of Dogecoin is based on the belief that it is valuable to others. They believe that someone else will buy it for a better price.
Dogecoin price is rising due to the network’s low liquidity and rapid expansion, according to Greenspan. “I don’t think this growth can continue until the network reaches critical mass.” Dogecoin has a bright future. “The real value lies in today’s meme-driven culture,” said Bucella, “and Doge reflects the network value of memetics, which could prove immense.” If the Doge community agrees on a burn or a new method of care through a protocol hard fork, that value is more likely to be held over the long term.
This article does not necessarily reflect the opinion of the editors or management of EconoTimes.