Is Dogecoin taking over the world?
Everywhere you care to look, Dogecoin seems to be taking over. Elon Musk’s May 2021 appearance on Saturday Night Live exposed millions of people across the USA to repeated use of the word “Dogecoin,” in the same breath as mentions of Bitcoin and Ethereum.
Younger generations who don’t watch TV may have come across Dogecoin on Tiktok, where influencers have been calling for a 1 dollar Dogecoin for months.
Bringing this closer to a reality, Dogecoin has finally been listed on Coinbase Pro, one of the largest crypto exchanges in the space.
Dogecoin, despite its status as a joke or meme coin, has been one of the best performing crypto assets of 2021.
Which leads us to ask: Is Dogecoin truly taking over the world, or is this just a flash in the kennel?
Will Dogecoin Overtake Bitcoin?
Although some may find it hard to believe, Dogecoin has historically held it’s value quite well against Bitcoin. This is in contrast to the many other crypto assets which have seen their value drop against BTC over time, as they gradually fell out of favor with the crypto crowd.
This is made all the more impressive when you consider that Dogecoin has been around since 2013, and the majority of other altcoins from that period have disappeared (Peercoin, anyone?).
Even though the price of Doge can seem “cheap” because of its huge (and unlimited) total supply of coins, the fact that it rarely strays out of the top 25 by market capitalization shows that it still performs relatively well against other crypto projects.
Those considering buying Dogecoin should bear this fact in mind. Market capitalization (the combined value stored in a cryptocurrency or company share) is a better indication of whether a coin is under or overvalued. Considering the fundamentals of Doge, the coin does seem overvalued at the time of writing.
In 2021, Doge’s value against BTC has soared to even higher levels than usual:
This may be due to a perfect storm of altcoin dominance increasing marketwide, and Doge’s recent publicity drive.
But stats from crypto analytics platform intotheblock show that the number of daily active addresses on Doge is not growing anywhere near as much as the price:
Doge is backed by significantly fewer nodes than Bitcoin, with around 1,500 nodes, as opposed to the 10,000 core nodes and approx 90,000 listening nodes running on the Bitcoin network.
Nodes are basically computers connected to the network of a coin, which play a role in the consensus mechanism of transactions on the network. The more active nodes there are, the more decentralized and secure a project is.
Even though the figure of 1,500 nodes is still pretty impressive for a “joke project,” there are also reports of syncing problems on the Dogecoin network, due to a lack of active development, which is important to the long term success of any crypto project.
Will Dogecoin Reach One Dollar?
Lots of GenY investors are desperate for the price of Dogecoin to reach a value of one dollar for the first time in its history, with #dogecointothemoon trending on Twitter, and Dogecoin rocket emojis popping up all over TikTok.
Conventional wisdom would say that the price of Dogecoin, against both BTC and the dollar, has overextended itself at the time of writing, and that Doge enthusiasts or crypto newbies should be careful of buying near the top.
A one dollar Dogecoin may be possible in the future, but better opportunities could be found elsewhere.
The coin has historically been very volatile, and should probably still be considered a fun, community project, rather than a serious investment with a compelling business use case. If the hype on social media dies down, there is little organic need for Dogecoin, other than for tipping popular Reddit posts, and even that could be done just as easily with other coins.
But the recent Coinbase listing has given Dogecoin another boost, and in the world of crypto, anything can happen, especially in a bullish market.
And if you’re a true Doge HODLer, then 1 Doge will always be equal to 1 Doge:
What is Shiba Inu (SHIB) coin, and how is SHIB different from DOGE?
Despite only hitting the headlines in May 2021, Shiba Inu Coin has actually been in circulation since August 2020. It received attention after being “pumped” on r/dogecoin, r/wallstreetbets, and other online communities, and rising in price by almost 40,000% in one month.
For those still wondering what is Shiba coin and what this means, a pump and dump is when the price of a token is artificially inflated by a coordinated community effort, before those who have made huge profits step in and start selling their tokens, causing the price to fall as rapidly as it rose.
The SHIB token is available on large exchanges such as Binance and Huobi, which perhaps gives it a feeling of credibility, although Binance CEO CZ did warn that the project came with “super high risk”.
Potential risks of Shiba Inu Coin include the huge number of SHIB tokens still to be dropped into circulation. The total supply of SHIB is a whopping 1 quadrillion coins, although half of these were apparently gifted to Vitalik Buterin, who burned 90% of the stash and is in the process of donating the remaining 10% to charities.
This remaining 10% could still represent up to 45 trillion tokens being dumped onto the market by the chosen charities though, which, coupled with profit taking from the architects of the unnatural price action, could lead to significant downwards pressure on the price of SHIB.
Also, and perhaps more importantly, the Shiba Inu project seems to have no business plan or user utility other than being a “Dogecoin killer”, which not many in the crypto space would want anyway:
Will Dogecoin take over the world?
Despite its lack of fundamental value, Dogecoin has one thing going for it: it’s community.
The reddit page r/dogecoin has over 2 million “subshibers”, and the Dogecoin dev page on Twitter is followed by almost half a million people.
Dogecoin has also been used for charity drives, such as in 2014 when the Doge community sponsored a rare Winter Olympics appearance by the Jamaica national bobsled team.
The internet clearly loves it’s favourite shiba-inu-themed meme coin, and even if it’s not as technically innovative as other cryptocurrencies such as Bitcoin, Ethereum and Monero, well, that’s kind of the point.
And don’t forget that, even if Doge doesn’t take over our world, it could still become the official cryptocurrency of other planets:
This content is for informational purposes only and is not investment advice. You should consult a qualified licensed advisor before engaging in any transaction.