Natalie Laz

20th April 2021

What is Dogecoin?

What is the origin of the trendiest cryptocurrency of 2021? How much is Dogecoin worth and will it ever reach $1? Find out why is Elon Musk taking the Doge to the Moon.

The Dogecoin was created by software engineers Billy Markus and Jackson Palmer in 2013. A tribute to the online community, inspired by the Japanese Shiba Inu meme trend, was originally meant to be nothing more than a practical joke. A tongue-in-cheek answer to Bitcoin, that ended up instantly adopted by the Internet audience, serving as a tipping tool, accompanying Reddit post upvotes.

Back then, Doge’s market worth was still close to zero. Yet, the crypto has quickly managed to generate a sentimental value, fundamental to its current popularity uprising. But is Shiba Inu’s memetic charm the only factor differentiating Dogecoin from other cryptocurrencies, or is there more pragmatic reasoning behind its fame and fortune? Is it worth investing in Dogecoin and will it maintain its position on the market as the Internet hype fades away?

Why is Dogecoin Going Up?

The fun & friendly Internet money frenzy started at the beginning of February, with a SatoshiStreetBets group Reddit campaign. The Internet movement, named after the mysterious Bitcoin creator, pseudonymous Satoshi Nakamoto, started as a virtual currency-focused answer to WallStreetBets. Soon after, Elon Musk followed their initiative with a series of frolicsome tweets.

An online community of crypto-aficionados eagerly jumped on the short squeezing bandwagon, rapidly pumping Doge’s value up. Redditors required little encouragement to enthusiastically unite in the currency’s restoration process, rallying its price from US$0.0033 on 15th December 2020 to US$0.0126 on 28th January 2021.

Dogecoin to The Moon

Although it’s been merely two months since Dogecoin explosive resurgence, it already seems hard to imagine the crypto market without its frisky presence. Doge’s humble value in Q4 2020 was merely a preamble to its latter market-shaking rocket launch. Dogecoin’s media recognition reached its prime time on the 28th of January, when Tesla CEO, Elon Musk encapsulated his commendation in a series of applauding tweets, flying Doge to the Moon, in accordance to its official slogan. He has even suggested that the “people’s crypto” as he called it, could become the official currency on Mars.

The Internet devotedly followed the suggestion of the world-richest crypto-influencer. Doge’s worth ballooned by 800% within 24 hours after his laconic blessing, raising its market cap from $5 to $7 billion. Shortly after, Snopp Doge and Gene Simmons of Kiss, united in the public appraisal for the crypto.

Puppy Love

This is not the first time investors could observe Doge’s value prancing across the price charts, responding to the online community’s commands, as expected of a good doggo. The crypto had already famously jumped in early 2018, following the Doge meme revival on Reddit & 9gag social platforms. A very similar effect on the currency resulted from a viral TikTok challenge in July 2020, urging users to buy crypto, which casually spiked its value by almost 700%.

Doge appears to have an added core component, which equips it with a quality that other cryptocurrencies are typically bereft of – an emotional value in place of an intrinsic one. Even over the last weekend of April 18th, when the vast majority of the crypto market flash crashed, Dogecoin managed to remain bullish and increased by 28%, against all odds.

Will Dogecoin reach $1?

Is Elon’s ambitious plan to make Dogecoin the future currency of Mars more than an ambiguous prank? The mock-named “Dogecoin CEO”, openly advocates for his favoured crypto. Yet, he never forgets to occasionally remind his public that this support stems from his natural inclination to all things hilarious, rather than financial advice.

Nevertheless, this declaration didn’t stop him from buying Dogecoin for his son. Neither did it stop him from investing $1.5 billion in Bitcoin on behalf of Tesla, nor encouraging electric car buyers to pay with Bitcoin and gold, as the alternative to fiat.

Is it achievable for Dogecoin to hold its position on the market, or is it destined to thrive just as fleetingly as the average internet fad? At the moment, the online community seems to be uniting in striving to pump Dogecoin’s worth, mutually encouraging buyers to hold, till its value reaches a dollar.

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What seemed unattainable at the end of 2020, now bears the hallmarks of natural currency progression. On February 8th, the market worth of the much joked-about coin reached its all-time best, going above $10 billion, making Dogecoin the 8th biggest cryptocurrency worldwide.

Even though its value quickly fell from its $0.092 record-high, Doge now appears to be pawing his way back up the market charts again. Despite occasional plunges, it looks like Doge is slowly shedding off the internet curiosity trademark, with the potential to mature into a reasonable choice as an investment vehicle.

Hilarious value aside, from the market’s perspective Dogecoin could be Bitcoin’s younger, prankstier sibling, just roller-coastering on a less impressive railway. It’s still far too early to firmly postulate Dogecoin’s future on the Moon (or Mars for that matter) but even if its $1 mission carries the sci-fi attributes, the general predictions are increasingly optimistic.

How many Dogecoins are there?

Jackson Palmer initially intended to keep about 100 billion Dogecoins in circulation, although eventually decided to change his own protocol. Based on the online community’s feedback, Jackson left the Crypto uncapped. With an unlimited supply, 126 billion Dogecoins have already been mined. As more tokens appear every second, the coin might eventually experience a rate of inflation, in which it holds a slight resemblance to fiat.

For comparison, Bitcoin’s supply is capped at 21 Million. The estimated time to reach this limit is in a century from now, after which no new coins will enter the crypto market.

Digital Currencies Become Mainstream

There seems to be a close correlation between Elon’s jolly influencing, squeezing Redditors and the unprecedented, cumulative surge of interest in non-fiat currencies, dominating the financial firmament of Q1 2021. What exactly does this extreme polarisation indicate for the investors?

All these movements appear to spurt out of a growing disenchantment with governmental institutes and byzantine banking practices. With the decentralised assemblage of small traders working in unison, a new financial inclination is brought into focus.

The amassed online community is steadily building its momentum, dedicated to paving the way for a new monetary order. Their endeavours show the ripening necessity for a new financial architecture for future generations, this time governed solely by its consumers, and simultaneously – a chance to dethrone the hitherto unreachable capitalistic casino.

At the same time, virtual currencies are currently increasing levels of technological mass adoption, with a growing interest from both private and institutional investors. Crypto is still relatively new on the financial market and only recently stepped into the media spotlight. With current rates comparably low in the overview of their exponential growth prospects, it might be the right time to consider investing in Dogecoin. However, one thing seems certain; the upcoming monetary architecture will be digital.

*The information contained in this article is not intended as, and shall not be understood, or constructed as a recommendation or financial advice. You should consider seeking independent legal, financial or other advice to check how the information relates to your unique circumstances.

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