Currently, Dogecoin (DOGE) seems to be the biggest trend of the crypto industry. The crypto asset conceived initially as a meme has skyrocketed by more than 500% in the past seven days, instantly creating several Dogecoin millionaires, even more than those that decided to purchase bitcoin at the beginning of the year.
The value of the cryptocurrency reached $0.45, which means now it has a market value of $48 billion. Thus, Dogecoin became one of the top cryptocurrencies in the market, surpassing solid projects like Polkadot (DOT) and Cardano (ADA), according to Coin Market Cap.
In this article, we provide you a realistic overview of Dogecoin's future in 2021.
Born Out of a Joke - A Look Back into Dogecoin's History
Created by software engineers Billy Markus and Jackson Palmer, the idea behind the crypto asset was conceived as a joke. The cryptocurrency was named "Doge", due to a popular meme of a Japanese dog Shiba Inu that exploded on the internet during 2013.
When Dogecoin was launched, its usage was restricted to just a few internet geeks, just as Bitcoin was at its inception. However, its expansion within social networks like Reddit opened doors for the "Doggo’s cryptocurrency" to reach different audiences.
An example of this happened in 2014, when the Dogecoin community donated a sum of $55,000 to the United States stock car races, partnering with NASCAR driver Josh Wise and placing the cryptocurrency's logo on the front of the car as an official sponsor.
After news of the stock car sponsorship hit the global community, the Dogecoin community raised $25,000 to sponsor the Jamaican bobsled team for the winter Olympics in Sochi, Russia that same year, since they could not afford the trip to the competition.
Is Dogecoin the Celebrities' Cryptocurrency?
Mark Cuban, the owner of NBA Dallas Mavericks, recently stated that he is strongly confident that DOGE is here to stay and even has the potential to hit a $1 price tag soon. The statement came few days after his team started accepting Dogecoin as a form of payment.
It is crucial to mention that, over the past few months, DOGE's list of prominent followers has grown at a furious pace.
The list includes celebrities such as rock n' roll legend Gene Simmons (Kiss), former adult film star Mia Khalifa and American rappers Snoop Dogg and Lil Yachty - all showing their support for the digital asset via social media.
Nonetheless, the most prominent sponsor of the crypto asset is still Tesla CEO Elon Musk, who has been strongly supporting DOGE through his Twitter account for almost a year.
Even though he has stated that his support was a joke, his statements boosted Dogecoin's value like never seen before.
What Lies Ahead for Doge in 2021? - A Realistic Overview
Dogecoin's recent performance is comparable with GameStop's situation, in which the brand managed to emerge from bankruptcy in a few days and more than doubled its market value in the period.
In this case, a huge percentage of the hype generated around GameStop was a result of the interactions between thousands of participants in a Reddit forum, who did not want to see the traditional game store go bankrupt.
The situation is that thousands of small investors came together to buy GameStop's stock and keep the store alive. The move was considered as market manipulation and Keith Gill, one of the users of the Reddit social network that boosted GameStop's actions, had to explain himself to the US Treasury.
Accordingly, a similar situation occurred with Dogecoin's price, which was strongly influenced by the comments of celebrities, making it more valuable than the litecoin’s price.
For example, it was the case of the famous chef and TV host Guy Fieri, who tweeted "Launch for the MOON #Dogecoin", or even Mark Cuban, who also made his contribution for the currency to rise through your Twitter account.
Market experts warn of the risks of getting involved in crypto projects simply for fun. Many people believe in such investments and end up losing money when the currency price plummets.
As with other investments, it is necessary to assess whether the project is solid, has a future, and is safe. Cryptocurrencies could not be different. Even now, at a time called alt-season, these investments must be viewed with caution.
Final Thoughts
It is impossible to deny that Dogecoin is by far one of the most polarizing cryptocurrency projects on the crypto market today.
Many people think that DOGE is certainly a joke that has no future, while others - including many celebrities and business tycoons- evidently believe that it is a viable financial instrument that will remain for a long time.
If they actually believe in it, it is impossible to determine, but the reality is that they are leading many people to believe and invest in Dogecoin - which will certainly harm a lot of people's pockets.