Dogecoin (DOGE) before the market correction on April 20, 8% from its value on January 1. Increased by about 700. In fact, the altcoin rose almost 500% on the 7-day chart in mid-April. Likewise, Dogecoin has overtaken XRP with a market value of $ 69 billion.
Yet there is a lot of doubt about DOGE.
According to the news of Jibin George on AMBCrypto because it could not go beyond being seen as a “joke coin”. It is also noticeable that it has no use cases and the core development team is lacking. However, the only thing he has is Elon Musk and the “hype” he created.
This has fueled speculation that cryptocurrency is a bubble that will soon become buoyant and deteriorate. The same thought was voiced by famous TV personality Jim Cramer. According to Cramer, Dogecoin and NFTs are extremes of what makes up cryptocurrencies, and they are both within the bubble zone:
Dogecoin was considered a joke and is still a joke except that so many more people are still investing. I think a more serious market will place a bet in the direction of Dogecoin because the currency’s movement is more reminiscent of sports betting. Why not? To me it’s just a sport, so why not gamble on it?
In many ways, Cramer’s last words are an extension of his remarks in the last interview. Also emphasizing DOGE’s “joke” status, Cramer said “Not all cryptos are created equal.”
Meltem Demirörs from CoinShares shared similar thoughts and said:
This is a classic balloon to me. For this reason, my company does not produce Dogecoin analysis. There is no Dogecoin in our market.
Inside the bubble
These are not just the statements of Cramer and Demirörs. According to the AMBCrypto author, there is a lot of evidence supporting the bubble claims. The author points out:
Think about this – According to estimates, 1% of Dogecoin addresses own 94% of the total supply. A single address is for 27% of all DOGEs. Moreover, short-term owners (those holding DOGE for less than a month) rose from 165,000 in December to 582,000 in April. So why hasn’t the balloon padded yet? Maybe he doesn’t have a right or one answer. However, one can look at the source of the hype around it: Elon Musk.
Tesla CEO has been tweeting DOGE for a long time, and many of his tweets are triggering a DOGE rally incomparable to the rest of the market. Musk, for example, has tweeted about DOGE at least 25 times since the beginning of the year. Here is his most recent tweet:
Following this tweet, DOGE increased by 25% within minutes.
Also, over the past few months, the manager claimed he was serious about putting a real “Dogecoin” on the moon.
According to the AMBCrypto author, these are not organic and ecosystem-centric developments that we associate with being behind asset-specific price increases. Exactly what it is.
Musk isn’t alone either. For example, Mark Cuban said that Dogecoin has no real value. But then he not only bought DOGE, but even defended it.
So why is Musk pumping Dogecoin? He says he does not own DOGE. Tesla also does not hold DOGE. So a pump & dump situation can be ignored. However, when this is ignored, there is no logical reason. According to the author, Musk’s ability to fuel pump & dump in many ways is not just for the health of the crypto market; it can also be seriously effective for perception in the outside world. He thinks that the Dogecoin bubble will therefore be buoyant.