A visual representation of dogecoin and other cryptocurrencies.
Yuriko Nakao | Getty Images
Dogecoin started out as a joke. It is now a digital currency in the top ten worth $ 34 billion.
The cryptocurrency is based on the “Doge” meme, which gained popularity in late 2013. The meme portrays a Shiba Inu dog alongside absurd phrases in multicolored comic-free font text.
Created in 2013 by software engineers Billy Markus and Jackson Palmer, dogecoin was intended to be used as a faster but “fun” alternative to bitcoin. He has since found a growing online community.
And now, defying all odds, dogecoin has a total market value of $ 34 billion, according to cryptocurrency market data site CoinGecko, which added about $ 19.9 billion in the last 24 hours. The digital testimony hit an all-time high of 28 cents on Friday morning, more than double the price a day ago.
“I just became a Dogecoin millionaire”
It’s not the first time dogecoin has seen a wild rise. Like many cryptocurrencies, it has a tendency to volatile price changes. Earlier this year, dogecoin began to catch up, shooting with the enthusiasm of a Reddit group called SatoshiStreetBets.
Similar to the WallStreetBets subreddit, which helped fuel a concentration of GameStop shares in early 2021, SatoshiStreetBets aims to raise cryptocurrency prices.
Dogecoin went up again last week, reaching $ 10 cents for the first time on Wednesday. It has increased by 300% in the last seven days.
On Friday, a Reddit user posted an image of their dogecoin funds to the Robinhood investment app.
“Hey guys, I just became a Dogecoin millionaire,” said the user, who showed a balance of $ 1,081,441.29 in his account.
Why does dogecoin meet?
On the one hand, there is the Coinbase list. The most popular virtual currency exchange in the United States was made public on Wednesday, with a market cap of $ 100 billion at a relevant time for cryptocurrencies.
The excitement surrounding Coinbase’s debut sparked a rise in bitcoin and ether prices. Bitcoin hit a record high of more than $ 64,000 on Thursday, while ether briefly topped $ 2,500 for the first time on Friday morning. Dogecoin has not been an exception to the frantic interest in these digital assets.
Dogecoin has attracted a following among Robinhood users. On Thursday, the U.S. online brokerage said there was a “major disruption” in its cryptocurrency trading function after facing “unprecedented demand.” The feature is back online, Robinhood said.
Some reports have attributed the latest dogecoin rally to the support of the meme-based testimony of Tesla CEO Elon Musk. Musk has created several tweets about dogecoin, which in turn have helped increase its price.
On Thursday, Musk posted a cryptic tweet that said “Doge barking at the moon,” probably in reference to the popular cryptographic slang phrase “at the moon.”
The billionaire has called dogecoin his cryptocurrency “fav” and “people’s cryptography.” Musk has also been a supporter of Bitcoin, with his electric car company buying $ 1.5 billion for cryptocurrency earlier this year.
But his tweets have worried some investors, given his apparent ability to move markets. Some bitcoin investors, for example, have sounded the alarm about Musk’s dogecoin tweets. Nic Carter, co-founder of Castle Island Ventures, warned that retail investors will “lose money with dogecoin,” calling it a “vehicle of speculation.”
Bubble problems
The spectacular price of Dogecoin has caused concern about a potential bubble in the cryptocurrency market. Some investors already see bitcoin as a speculative bubble: the world’s most popular digital currency has doubled since early 2021.
“The rise of Dogecoin is a classic example of the theory of the biggest fools,” David Kimberley, an analyst at UK investment app Freetrade, told CNBC.
“People buy the cryptocurrency, not because they think it has any significant value, but because they expect others to accumulate, raise the price, and then be able to sell and earn quickly.”
But, Kimberley added, “when everyone does, the bubble will finally have to burst and you’ll be changed if you don’t get out on time. And it’s almost impossible to tell when that will happen.”
“This is doubly the case in crypto markets where a small group of players usually keep a large amount of the total number of ‘coins’ in circulation. This means that only one person is needed to dump all their holdings because the whole market is can close. “