Meme cryptocurrency’s rise sparks bubble fears

A visible illustration of dogecoin and different cryptocurrencies.

Yuriko Nakao | Getty Pictures

Dogecoin began out as a joke. Now it is a top-10 digital forex value $34 billion.

The cryptocurrency is predicated on the “Doge” meme, which rose to reputation in late 2013. The meme portrays a Shiba Inu canine alongside nonsensical phrases in multicolored, Comedian Sans-font textual content.

Created in 2013 by software program engineers Billy Markus and Jackson Palmer, dogecoin was meant for use as a sooner however “enjoyable” different to bitcoin. It has since discovered a rising group on-line.

And now, defying all odds, dogecoin has a complete market worth of $34 billion, in keeping with crypto market knowledge website CoinGecko, including about $19.9 billion within the final 24 hours. The digital token reached an all-time excessive above 28 cents Friday morning, greater than doubling in value from a day in the past.

‘I simply grew to become a Dogecoin millionaire’

Dogecoin has been climbing again in the past week, hitting 10 cents a coin for the first time on Wednesday. It’s risen by a whopping 300% in the last seven days.

On Friday, a Reddit user posted a picture of their dogecoin holdings on the Robinhood investing app.

“Hey guys I just became a Dogecoin millionaire,” the user said, showing a balance of $1,081,441.29 in their account.

Why is dogecoin rallying?

For one, there’s the Coinbase listing. The most popular U.S. virtual currency exchange went public on Wednesday, briefly hitting a $100 billion market cap in a landmark moment for cryptocurrencies.

The excitement around Coinbase’s debut led to a surge in the prices of bitcoin and ether. Bitcoin hit a record high of more than $64,000 on Thursday, while ether briefly topped $2,500 for the first time Friday morning. Dogecoin has been no exception to the frenzied interest in these digital assets.

Dogecoin has been met with frenzied interest from users of Robinhood. On Thursday, the U.S. online brokerage said there was a “major outage” in its crypto trading feature after facing “unprecedented demand.” The feature is now back online, Robinhood said.

Some reports have attributed the latest dogecoin rally to support for the meme-based token from Tesla CEO Elon Musk. Musk has made several tweets about dogecoin, which in turn has helped push up its price.

On Thursday, Musk posted a cryptic tweet saying “Doge Barking at the Moon,” likely in reference to the popular crypto slang phrase “to the moon.”

The billionaire has called dogecoin his “fav” cryptocurrency and “the people’s crypto.” Musk has also come out as a supporter of bitcoin, with his electric car firm buying $1.5 billion worth of the cryptocurrency earlier this year.

But his tweets have worried some investors, given their apparent ability to move markets. Some bitcoin investors, for instance, have sounded the alarm about Musk’s dogecoin tweets. Nic Carter, co-founder of Castle Island Ventures, warned retail investors “are going to lose money on dogecoin,” calling it a “vehicle for speculation.”

Bubble concerns

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