Dogecoin: What’s Next for Musk’s Favorite Crypto?

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In Brief
  • Dogecoin’s (DOGE) rise was accompanied by a series of high profile mentions.

  • Despite the sustained attention, DOGE has been lingering around $0.05 for the past month.

  • DOGE’s popularity and increasing usage likely mean it won’t be going anywhere.

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After seeing an all-time high of $0.08 on February 7, the price has stagnated around $0.05 for the past month. This begs this question, what is next for Dogecoin (DOGE)?

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To answer that, it makes sense to first look at how Dogecoin (DOGE) got where it is.

DOGE Price History

At the end of December 2020, Dogecoin was trading for a mere $0.004. Then on Dec. 20, Tesla CEO Elon Musk tweeted simply, “One word: Doge.” These three words seemed to cause the price to rise by 40%. This was the first of many tweets that would influence the coin over the next few weeks.

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On the first day of the year, Dogecoin began to rally, and by Jan. 2 it had surpassed the penny-price-point for the first time reaching a new all-time high of $0.014. It hovered around $0.01 before floating down to $0.007. Then on Jan. 28, Musk worked his magic again, tweeting the cover of a magazine called “Dogue” in a veiled reference to the cryptocurrency. The market then went ballistic, shooting the price up 10-fold to $0.07. 

Over the course of January into February, nearly every price bump was accompanied by a tweet, but not only those of Musk’s. On Jan. 31 he mentioned his DOGE tweet may have been jokes; another bump. On Feb. 4, tech billionaire Mark Cuban tweeted that he would take DOGE over a lottery ticket; another bump. Even rapper Snoop Dogg waded in, tweeting a picture of “Snoop Doge,” while tagging Elon Musk. It’s likely this tweet sent DOGE to its all-time high of $0.08.

However, since then, the price has come down. Although it has spiked up a few times, likely due to social media mentions, for the past month, DOGE has been trading between $0.04 and $0.06. Where does DOGE go from here?

Recent Developments

If social media mentions indicate market sentiment, it’s likely DOGE isn’t going anywhere. The token was the most talked about coin on Twitter in February. According to the data released by ICO Analytics, it enjoyed a 10.4% share on total Twitter mentions in February. Although only by a margin, this beat out Bitcoin (BTC), which had 10.1% of total mentions.

Its usage has also seen a marked increase. Mark Cuban recently tweeted that the store for his NBA team, the Dallas Mavericks, had recently surpassed 20,000 DOGE transactions. This made them the largest merchant of the token in the world.

Additionally, American cryptocurrency ATM operator, CoinFlip recently announced that it would be accepting the coin across its network of 1,800 ATMs. Despite its low purchasing power, CoinFlip CEO Daniel Polotsky said DOGE would be joining its ‘portfolio of coins’ due to popular demand. Its popularity is such that even a DOGE Decentralized Exchange was launched this month.

Although it’s hard to say what could give DOGE another boost, it seems increasingly clear that it will be around for a while.

Disclaimer

All the information contained on our website is published in good faith and for general information purposes only. Any action the reader takes upon the information found on our website is strictly at their own risk.
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Nick is a data scientist who teaches economics and communication in Budapest, Hungary, where he received a BA in Political Science and Economics and an MSc in Business Analytics from CEU. He has been writing about cryptocurrency and blockchain technology since 2018, and is intrigued by its potential economic and political usage. He can best be described as an optimistic center-left skeptic.

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