While cryptocurrency purists may sit rolling their eyes at the phenomenon, it’s hard to deny dogecoin’s short-term value, even if it is based off something as fickle and volatile as an internet meme.
Add into the mix an eccentric billionaire with millions of devoted followers, and you have the recipe for a crypto explosion.
With Elon Musk continues to play god by dipping his finger in the pie, experts are predicting another boom for the joke coin. The Tesla CEO’s Twitter activity has led to the coin jumping up and down in value in recent weeks — with each innocuous passing reference from the 49-year-old causing erratic dips and surges in the market. His influence has pushed the coin, which was first created in 2013 as a “piss take” when doge was still vaguely funny, to rise more than 12,000 per cent in 2021 alone.
Dogecoin investors received good news this week after it was added to Coinbase, one of the world’s most popular cryptocurrency hubs. Prices surged up a whopping 33 per cent in a matter of hours after the announcement, bringing the asset to a clean A$0.50 per coin at the time of writing.
Crypto analyst Motiur Rahman predicts the rise will continue, making estimations based on previous market activity.
“Based on price action, it is anticipated that Dogecoin will rebound as investors are expected to get back into the market. The short-term moving averages are still gapping up,” he wrote in a column for Forex.
“It is an indicator that the price is overall trending up faster than the historical average despite the current correction.
Rahman predicts the meme coin will continue on its upwards trajectory for a further six months, granted Mr Musk doesn’t drop a bombshell on the entire thing.
“Looking further ahead, Dogecoin charts point to potential growth, as evidenced by its weekly charts,” he continued.
“The Dogecoin price chart shows an upward trajectory with consistent gains for six months. The upside momentum is supported in its price action this month.”
“Elon Musk has had a big impact on Dogecoin’s price action. He is the sole reason why Dogecoin is where it is today.
“Dogecoin has experienced significant growth from being a joke coin into one of the most valuable cryptocurrencies and can attribute most of its success to Elon’s tweets and large following, which propelled it to its current success.”
Let’s be perfectly clear. This article isn’t encouraging you to buy dogecoin. Unlike ethereum and other online currencies, dogecoin is pure vapourware, adding little to the cryptocurrency revolution outside public interest. One only needs to observe the incredible booms and busts it has experienced, mostly off the whim of Mr Musk, to understand it’s a financial hand grenade.
It could simply be the expectation that something as innocuous and silly as “doge” should fail, and that anything that slightly enhances its profile — like being added to a popular trading website or mentioned by a billionaire — results in a spree of investment interest.
By that metric, we could assume anything Elon Musk tweets about should be something to invest in, which is dangerous territory indeed.
Sure, you might be able to time the dip perfectly and come away with some serious gains throwing your hard-earned into dogecoin, but the chances anyone can accurately predict the optimal moment to strike are slim.
“In any case, whether positive or negative, it is likely that the buzz of publicity which has already been created around Dogecoin will continue to keep the interest high and may well produce a strong recovery in the coin’s price,” Rahman continued.
“This will be one of the factors that might not just see Dogecoin push past its recent highs but possibly test new highs above $1 as well.”
Co-founder of Finder.com Fred Schebesta threw his two cents in, acknowledging dogecoin and unlocking the unlikely achievement of it becoming a recognisable cryptocurrency, alongside bitcoin.
“It was created as a joke, but many believe it will periodically go up in value as long as it is around,” he said. “All other blockchains are in heavy competition to add value and claim success for the vertical they serve.”
Dogecoin is currently the world’s fifth most popular crypto, with an incredible market cap of US49 billion, and a circulation of 129,868,178,051 coins.