The Dogecoin Rocket Falls Short of the Moon

If the strange events surrounding the GameStop stock phenomenon have taught us anything, it’s that anything can happen when it comes to the market. That’s what investors of Dogecoin were banking on this past week. Fans of the meme-cryptocurrency took to the internet to declare Tuesday’s 4/20 as DogeDay to promote the crypto. The goal: $1 or bust. While Doge has skyrocketed in the last week, it has since plateaued about 60 cents shy of its target before finally dropping further.

Dogecoin was created in 2013 as a part of a joke poking fun at the Bitcoin trend. Its name comes from the popular meme featuring a Shiba Inu. Heading into the year, Dogecoin was trading at $.0057 per share. Hitching a ride on the GameStop stock crazy in late January, people took to the internet to hype up the crypto. Between January 26th and February 6th, Dogecoin jumped 100% to $.078. One of the biggest advocates of Doge: Elon Musk.

The Influential Billionaire

Musk has tweeted several times about Dogecoin in the past few months and spoke about it in a Clubhouse chat.

 “Dogecoin was made as a joke to make fun of cryptocurrencies, but fate loves irony. The most ironic outcome would be that Dogecoin becomes the currency of Earth in the future.”

While Reddit forums like r/Dogecoin and r/Wallstreetbets have stirred interest in the cryptocurrency, billionaire Elon Musk’s influence is undeniable. The value of Dogecoin surged every time he tweeted a meme.

Dogecoin leveled out between $.05 and $.06 per share between February and mid-April. Leading up to the internet-proclaimed DogeDay on April 20^th, Dogecoin jumped to $.36/ share on April 15^th and higher still to $.42/ share on April 16th. Enthusiasts were confident the stock was on its way to reaching the coveted $1/share mark on Tuesday, April 20^th. This was not the case.

Not a Dog Day Afterall

Dogecoin closed at $.29/ share on April 20^th, taking a large dip from where it was just days before. Since then, the cryptocurrency has only fallen. While the recent hype has appeared to level off, Dogecoin enthusiasts are still confident that the crypto will continue to grow. Dogecoin is currently up 5,800% on the year.

This year has seen an interesting trend in the market. Stocks, cryptocurrencies, and non-fungible tokens have seen massive growth and support from the internet – all powered by memes. Companies on the downward trend like AMC Theaters and GameStop had unprecedented growth on the market due almost entirely to internet trolls. Dogecoin rose to the 7^th most valuable form of cryptocurrency.

The nature of these trends is unpredictable. Redditors start a movement to raise the price of a stock for no other reason than to see if it can be done. Then, they pump up stock while sharing memes of dogs in rocket ships heading to the moon. From there, the rest of the internet catches on and more people buy in, encouraging the meme culture to push forward, resulting in a feedback loop. Old school market observation says this inevitably creates a market bubble. But nothing like this has been done before and cryptocurrency is still a relatively new concept. Novice traders and internet trolls have crippled hedge funds with a meme. Dogecoin could be the currency of the future. Stranger things have happened.