Dogecoin is a cryptocurrency with an unbeatable increase of over 12.000% to date, which started as a joke with no real usability. This story shows how dangerous and unfounded it is to invest in cryptocurrencies.
The current Dogecoin frenzy is likely to reflect the growing power of retailers equipped with “financial ammunition” thanks to incentive programs, limited gambling opportunities and excessive free time due to the coronavirus pandemic.
Investors’ financial decisions are usually based on speculation in online forums and chat groups. Logically, financial market players who manage large sums of money are responding to this trend by raising concerns about the “overheating” of financial markets. In extreme situations, a bubble can appear, which can explode within a centimetre of a second and hurt small investors when the market “turns”.
What is Dogecoin?
Dogecoin is a cryptocurrency that initially started as a joke in the world of cryptocurrencies. Its creators wrote the code in a few hours and created a website with dog memes and comics sans font.
The price of Dogecoin and its memes is a zero-sum game. The most famous memes have to do with Elon Musk, rockets and more. TikTok influencers also have a big impact on cryptocurrency, promoting Dogecoin as a bet for quick riches. Last year, when its price was a fraction of a minute, they predicted that Dogecoin would reach $1 on social media.
The most significant moves for Dogecoin took place shortly after the start of GameStop’s historic growth, thanks to investors and speculators in the financial markets who suddenly realised the liberated power of retail investors and moved to more interesting investment opportunities.
The Dogecoin explosion occurred when the market capitalisation reached $70 billion on May 5th, 2021, also thanks to Robinhood investors who accumulated so quickly that they “crashed” the application again.
DOGE to reach $1
With the current developments in the financial world, Dogecoin can easily reach $1. If you are planning to speculate on an investment good that has grown in value by more than 12.000%, it is an interesting alternative. On the other hand, you have to keep in mind that the risks outweigh the benefits.