Dogecoin has been the wildcard of cryptocurrencies. The coin has been touted by several celebrities and influencers, skyrocketing the cryptocurrencies value. Recently, the growth of Dogecoin even topped that of Bitcoin, with an over 500% increase due to a mix of new buyers, stimulus checks, and a new holiday called Dogeday.
Initially starting as a gimmick based around the increased popularity of cryptocurrencies like Bitcoin and Ethereum, Dogecoin fans have been riding the joke all the way to the moon. The best explanation for the coins continual rise can be summed up by Dogecoin advocate Elon Musk who referenced during a Clubhouse room that, "Fate Loves Irony". Many early investors put their faith into the sentiment and invested large sums of money back when the crypto was valued at well below a cent. Now, some of those early investors have shared their profits from the coin online, making them millionaires virtually overnight.
Reddit's Influence
Reddit has been known recently for utilizing the social platform to influence a variety of financial markets and institutions. Back in 2020, the subreddit WallStreetBets, which has now launched its own crypto token, put out a notice to several users that they intended to boost the stock of the undervalued company GameStop. As a means of sticking it to several hedge fund managers who shorted the stock and bet against the brand, the stunt was so successful that it resulted in a Super Bowl ad and left Robinhood having to temporarily shut down trading. Owner of the New York Mets, Steve Cohen, reported losing over 15% in an overall $5 billion dollar loss from companies that bet against GameStop. The iconic moment not only had Cohen removed from Twitter, but turned some financial first timers into wealthy entrepreneurs. Dogecoin has recently followed a similar trajectory, creating a subreddit of its own that features news updates and stories from successful early investors.
One recent investor, Glauber Contessoto, stated that he first heard about Dogecoin through Reddit. When the coin was valued at just under 5 cents, he invested $180,000 into Dogecoin. Then in April of 2021, he posted to the Dogecoin subreddit, "Hey guys I just became a Dogecoin millionaire," posting a screenshot from Robinhood of his earnings.
Contessoto isn't alone. Another user recently posted a story to the platform showcasing a growth of over 700%, also making themselves a millionaire virtually overnight. The subreddit also features several how-to posts that show users how to invest in the cryptocurrency. The posts also feature several warning though for younger viewers. The proponents of Dogecoin acknowledge that unlike the finite number of Bitcoin available, Dogecoin will continue to grow and accumulate more coins in a limitless structure. With no finite number to be mined, some have discussed that the value of the coin will continue to only decrease over time. To combat this, the creators of Dogecoin have spoken with Benzinga and shared their thoughts that as long as the popularity of the coin continues to rise, there is no threat to price even with its infinite growth.
Cryptocurrency Entering the Mainstream
Another attribution to the recent 400% rise in the value of Dogecoin was the virtual wallet Coinbase's announcement that they were going public on the NASDAQ. While certain media outlets such as USA Today and MSN have reported that the companies decision to go public affected the value of Dogecoin, Dogecoin is still one of the few cryptocurrencies to be excluded from the platform. Instead, Dogecoin can be purchased through a variety of secondhand outlets such as Robinhood, Binance, and Kraken.
There have also been several announcements from retailers and other companies that have now agreed to start accepting Dogecoin as payments. These include restaurants such as BitBurgers and Strange Donuts as well as fashion retailers including Life Sunglasses and DogeDayz. The slow acceptance of businesses to Dogecoin will only increase the coins value, allowing for some stronger comparisons when it comes to its price per dollar.
Celebrities and Social Media
The greatest proponent of growth though for Dogecoin which has made some young investors millionaires is the viral-ness of the meme currency. Social media sites like Twitter have continued to make the Dogecoin hashtag trend, relating to its rise in value. The hashtags are further fueled by celebrities who Tweet in support of the cryptocurrency. Elon Musk is one major proponent of the cryptocurrency. He has posted several Tweets referencing the coin that have resulted in several boosts in value. He even recently Tweeted his intention to put an actual Dogecoin on the moon during one of his future space endeavors.
Other celebrities have also taken to Twitter to boost the value of Dogecoin. Model and influencer Mia Khalifa has posted several times announcing her purchase of the cryptocurrency. Even Shark Tank celebrity and financial guru Mark Cuban announced that he had purchased sone with the intent of teaching his son about Cryptocurrency. Snoop Dogg has also joined in on the excitement, posting an altered version of his album cover featuring the Dogecoin meme to replace his own image.
With social media becoming a prevalent part of our lives during the recent pandemic, and with niche internet meme creators earning legitimized celebrity status, it was only a matter of time before virtual currencies accepted a meme as their own. Dogecoin is a risk, much like most publicly traded stocks or cryptocurrencies, but due to the brave investments of young adopters of the cryptocurrency, the coin has morphed from the joke it began as to one of the main contenders of cryptocurrencies that could eventually replace cash altogether. The future for the coin is just as mysterious and unexpected as its initial rise, but with fans continually Tweeting "To the Moon", it may only be a matter of time before the cryptocurrency value reaches a dollar. And if Dogecoin does pass a dollar and becomes worth more than the dollar itself during the process, maybe Elon's prediction will come true, "Fate *loves* irony. Frankly, too much."
Sources: MSN, TechStory, SWOKNews, UpRoxx, HypeBeast, CryptoNewspoint, Newsweek, Investopedia, Express, Benzinga, CNBC, NASDAQ, IBTimes, NYPost