The absolute maximum value of Dogecoin was recorded on May 8, 2021 at $0.7376. At the time of writing, October 1, 2023, the coin is trading 95% cheaper
DOGE's correlation with Bitcoin is lower than that of other cryptocurrencies. The fact is that the behavior of the DOGE rate is mainly shaped by Elon Musk
PoW DOGE
Dogecoin runs on its own blockchain, which is based on the Proof-of-Work (PoW) algorithm. This means that DOGE can be mined - just like Bitcoin.
In September 2022, Ethereum switched from Proof-of-Work (PoW) to Proof-of-Stake (PoS), and DOGE became the second largest PoW coin by capitalization after Bitcoin.
Tesla founder Elon Musk first mentioned Dogecoin in 2019. The businessman says that cryptocurrency helps him save his savings from inflation, and for this he chooses Dogecoin, Bitcoin and Ethereum.
Many believe that DOGE is only successful because of Musk's interest. In 2021, analysts found that 36% of American investors rely on a businessman's tweets when making investment decisions. After every mention of DOGE on Musk’s Twitter, the coin jumps.
When Musk bought Twitter in the fall of 2022, there were rumors that the businessman might make Dogecoin the official currency of the social network. The coin rate reacted with growth.
At the same time, speculation appeared online that Musk could launch a new cryptocurrency specifically for Twitter. But in August 2023, he said that he does not plan to do this yet. The statement again fueled investor interest in DOGE - they considered it a signal for the integration of Dogecoin into Twitter.
Investing in DOGE?
The patronage of Elon Musk has made DOGE the most capitalized and popular memcoin. But Dogecoin, which was originally a joke, has no fundamental value. If deflationary Bitcoin can be used as a tool for saving savings, Ethereum can be used to create new crypto projects on top of it, then Dogecoin does not have such functionality.
Many believe that if Elon Musk stops supporting Dogecoin, the coin will collapse. While there are no prerequisites for such a development of events and Musk’s tweets continue to launch DOGE into space, the coin can be considered a good investment.
Important reminder: I do not recommend investing more than 5% of your portfolio in any meme coin. Doge can skyrocket by 50% overnight, or it can fall.
