In the 2013 Scorsese movie; “The Wolf of Wall Street”, the lead character; Jordan Belfort lost his job as a Wall Street stockbroker in the aftermath of Black Monday; the largest one day stock market drop in history and short of options, went to work at a disreputable brokerage firm.
There, he made a discovery; he could make a lot of money dealing penny stocks because they had a much higher commission than the blue-chip stocks he used to deal as a Wall Street broker. All he had to do was leverage his considerable sales expertise to convince people to buy these stocks and he would be a wealthy man.
Doge has a similar appeal to penny stocks. While there are older, more valuable and more widely accepted crypto assets available on the market, this particular cryptocurrency is one of the most volatile around and as such, savvy traders only need to hold them for short periods to make profits by taking advantage of Dogecoin’s volatility.
This has opened the way for the coin to appreciate in value and now, with a market cap of over $29 billion, there is optimism that the value of Doge will continue to climb and eventually cross the $1 threshold.
Brief history of Dogecoin
The idea of Dogecoin was conceived on November 27, 2013 when Billy Marcus reached out to another software engineer, Jackson Palmer to discuss making a joke the latter had cracked earlier, “investing in Dogecoin- pretty sure it’s the next big thing”, a reality. A week later, the new coin was live.
A month after Dogecoin was launched, the value spiked by 300%, shocking many. This sudden rise was even more impressive because Bitcoin and many other altcoins were dropping in value at the time after the Chinese government forbade their banks from investing in Bitcoin.
After that, the value continued to rise even further, buoyed by the attention of social media users and Redditors as well as celebrities like Snoop Dogg, Mark Cuban and the unofficial patron of Dogecoin; Elon Musk.
How it became popular
Meme culture is very popular so this new coin, established off a joke made about a popular meme quickly gained a community of dedicated followers. This community started to trade Doge and use it to tip others in their social circles and soon it became a massive social media trend, catching the attention of millions worldwide and becoming mainstream.
Although the value of Dogecoin has soared, its biggest asset is the community of ardent followers who remain committed to “raising the value of Doge to the moon”. To them, Dogecoin exists as an icon to rally around and thumb their noses at the establishment. (In this case, conventional money, Bitcoin and other established altcoins)
As previously mentioned, the volatility of this coin also makes it very popular in the crypto community as savvy investors can take advantage of the regular price changes to make profits by applying the day-trading strategy.
Links to Elon Musk
One of the foremost public figures to take an interest in Doge is Elon Musk. While many have criticized the Tesla Motors CEO’s posts about Doge as borderline market manipulation, he has stayed on the right side of the law due to crypto laws being different from traditional stock market laws.
The South African billionaire has a massive influence on the value of Doge and has taken advantage of that on several occasions, posting about the coin on social media and in interviews. He even mentioned the crypto asset when he appeared on Saturday Night Live, calling it "a hustle" at one point, causing the value to drop.
It has not been all plain sailing for Dogecoin, however as there have been some setbacks along the way.
One of the co-founders quit the project and even criticized the success of Dogecoin, questioning how a joke coin came to be worth so much, saying: “I have a lot of faith in the Dogecoin core development team to keep the software stable and secure, but I think it says a lot about the state of the cryptocurrency space in general that a currency with a dog on it, which hasn’t released a software update in over 2 years, has a $1B+ market cap.”
Also, top crypto analysts have labeled Doge an “elaborate pump and dump scheme”, a characteristic that if correct, it would share with the penny stocks preferred by the infamous Wolf of Wall Street.
Long and short-term predictions
The volatility favored by many traders means that any predictions for a short-term Doge revival/loss are very likely to be drawn in the sand. Long-term, experts have predicted that by the end of the year, the value of Doge should have crossed $1.
With that being said, this isn’t a coin you commit the bulk of your funds to. Only take small positions day-to-day and as with other crypto assets, invest with funds you do not mind losing.
- Can I trade Dogecoin on Obiex?
Yes you can. As of today 23/09/'21, Dogecoin is valued at $0.22 and can be traded on the Obiex website.
2. What’s the best trading strategy to employ with Doge?
Since the value of this coin fluctuates so often, the best strategy to use is day trading. This strategy allows you to take up several short-term day-to-day positions and is perfect for a crypto asset as volatile as Doge.
3. Is this coin safe for me to trade?
As with most crypto assets, the value of Doge is highly volatile and is affected by several factors. Take the usual precautions you’d take with other crypto assets like Bitcoin – don’t invest money you’re not comfortable losing.
4. What can I use Dogecoin for?
Dogecoin can be traded on crypto exchanges. It can also be used to tip other users in social media communities and can be used to make payments at some merchant services. Earlier this year, SpaceX announced that their moon mission scheduled for 2022 will be funded by Doge.
Disclaimer: this article was written by the writer to provide guidance and understanding of cryptocurrency trading. It is not an exhaustive list and should not be taken as financial advice. Obiex Finance will not be held liable for your investment decisions.