Why is dogecoin going up?
In the world of cryptocurrency, nothing seems to amaze us anymore. Unusual coin offerings, wild price swings, and now Dogecoin’s astronomical rise. Perhaps you’re wondering, why is Dogecoin going up? Named after a popular Internet meme featuring a Shiba Inu dog, Dogecoin was initially created as a joke. However, it’s no joke anymore. The digital coin’s value has gone through the roof, becoming a household name and intriguing investment for many.
To understand the sudden rise of this meme-based digital currency, we must first understand how the market perceives it. Dogecoin isn’t merely an investment tool or a regular currency, it’s a social phenomenon. The concept of a meme-inspiring a form of monetary exchange resonates with millennials and Generation Z, who often drive popular culture and technology trends. Besides, they’ve mastered the art of using social media to accelerate and amplify trends, just like Dogecoin.
One of the significant factors behind Dogecoin’s upward trajectory is linked with celebrities, entrepreneurs, and influential figures showing support for this digital coin. Tesla CEO Elon Musk is one of the most notable figures endorsing the digital coin, often mentioning it his tweets that have contributed to spikes in Dogecoin’s value. His words can influence markets massively, and Dogecoin has reaped the benefits of his support.
But, even Musk’s tweets aren’t solely responsible for its rise. Technology advancements also play a critical role. Dogecoin’s coding originally had a hard cap of 100 billion coins to prevent too many from flooding the market. However, the cap was removed, and now, around 113 billion coins are in circulation. The expectation that coding updates might enable smart contracts on Dogecoin’s blockchain, similar to Ethereum, also sparked investors’ interest.
Besides, let’s not overlook the ‘GameStop effect.’ The world witnessed retail investors collaborating online to drive up the prices of traditionally low-value assets, with video game store GameStop being the most famous incident in early 2021. Digitally-savvy, small investors rallied around their chosen assets, in this case, Dogecoin, using social media platforms like Reddit and Twitter to orchestrate buying waves.
It’s also crucial to consider the psychological aspect that governs the behavior of many investors. Dogecoin’s less serious, fun persona appeals to those seeking an alternative to the more ‘corporate-backed’ Bitcoin. It’s being seen as the people’s cryptocurrency, an affordable, and accessible option for everyone. It’s another reason the coin’s popularity surged as it appealed to a new demographic of investors.
However, it would be prudent to remember the highly volatile nature of cryptocurrencies, including Dogecoin. The same internet frenzy that drives up the price can quickly turn, resulting in a rapid decrease in value. As viral trends come and go, sticking around for the long-term may prove challenging. In spite of this, the story of Dogecoin’s rise is a fascinating glimpse into the influence of social media on world economies, the appeal of meme culture, and the collective power of individual investors. In these modern times, even a joke can become a lucrative investment opportunity, and Dogecoin is a testament to that.
