In the world of cryptocurrency, there is a token that attracts countless investors' attention with its unique charm and wild price fluctuations: Dogecoin (DOGE). Since its launch in 2013, Dogecoin's price increase has been miraculous, especially with the push from the world's richest man, Elon Musk. This token, originally seen as a 'joke,' has surprisingly become the focal point of market attention. Recently, with Musk and Trump's 'political marriage,' Dogecoin seems to be experiencing another wave of enthusiasm, driving the price surge.
1. The crazy rise of Dogecoin
The birth of Dogecoin itself carries a hint of mockery and satire. It was jointly created by Billy Markus and Jackson Palmer in 2013, inspired by the then-popular 'Doge' Shiba Inu meme. Unlike mainstream cryptocurrencies like Bitcoin, Dogecoin was originally intended to satirize market speculation and create a relaxed, community-driven token. It has no supply cap, aiming to prevent long-term holders from hoarding coins and making cryptocurrency more 'friendly' and 'accessible.'
However, it is precisely this simplicity and community-driven culture that provides Dogecoin with a certain market foundation. In early 2014, the Dogecoin community raised funds through crowdfunding for the Jamaican bobsled team to help them participate in the Sochi Winter Olympics. This event garnered significant media exposure for Dogecoin in its early stages, becoming a symbol of internet culture. Since then, Dogecoin has also been used for other charitable projects, such as funding water well construction projects in Africa and sponsoring NASCAR driver Josh Wise. Although these events showcased Dogecoin's potential as a payment tool, its price remained relatively low for a long time as it was still regarded as a 'joke' currency.
Until 2020, Dogecoin's fate underwent a significant change. Elon Musk became its most famous supporter. He mentioned Dogecoin several times on Twitter, calling it 'the people’s crypto,' and referred to himself as the 'DogeFather.' Whenever Musk tweeted in support of Dogecoin, its price would experience dramatic fluctuations. In April 2021, Musk even tweeted a famous 'moon landing' Doge image, causing Dogecoin's price to reach an all-time high, breaking through 0.70 dollars.
Musk the Dogecoin Father
At that time, the token rose from a fraction of a cent to nearly 0.75 dollars in four months. This move marked an increase of over 13,000%. These gains allowed the largest holders of the token to make huge profits. The largest wallet began purchasing DOGE in the summer of 2023 and became the largest holder of this token within a month. This wallet owns over 31 billion DOGE, valued at about 5.9 billion dollars.
At its peak, this wallet held 33 billion DOGE, worth up to 6.9 billion dollars.
So who held the most Dogecoin at that time? Of course, it was Musk; otherwise, he wouldn't be waving the flag for Dogecoin. There’s a greater probability that he acquired this project and then used his abilities to help market and sell it, making him the best coin-selling boss.
Currently, about 1,101 wallets hold more than 1 million dollars worth of DOGE. However, this number may change with the fluctuations in DOGE's price.
Overall, the top 15 addresses hold about 50% of the supply, and the top 136 wallets hold 70% of the token supply.
These dynamics indicate that DOGE is mainly held by a large number of token holders. Since most of the supply is in the hands of a few wallets, the transactions of these wallets will largely directly affect the price trend. Moreover, this thing itself belongs to the MEME coin category, a type of concept coin, and the issuance is controlled by the project party, so the price increase also relies on marketing.
The plunge of Dogecoin has led Musk to face legal troubles.
The Dogecoin Father and Tesla CEO Musk was sued in 2022, accused of frequently promoting Dogecoin in his posts, leading to significant price fluctuations. A group of disgruntled Dogecoin investors filed a lawsuit against Musk and Tesla in June 2022, accusing them of intentionally inflating Dogecoin prices to engage in insider trading, attracting retail investors, and then dumping large quantities to cause the price to plummet.
This lawsuit was modified four times over two years. Investors accused Musk of pushing Dogecoin's price up by over 36,000% in two years before causing its crash. They also accused Musk of using his status as the world's richest person to operate and manipulate a Dogecoin pyramid scheme, seeking compensation of 258 billion dollars.
Unfortunately, how could you possibly win? These people certainly lost their case. This shows that Musk's manipulation of Dogecoin is solely for profit; if you really believed his words, you would be the one taking the loss.
2. Musk's political ambitions and the 'political traffic' of Dogecoin
Musk is not only a tech giant but also a businessman with political ambitions. He has expressed dissatisfaction with the efficiency of the U.S. government in public several times and proposed the establishment of a department called the 'Department of Government Efficiency,' abbreviated as D.O.G.E. This plan aims to conduct a comprehensive financial audit of the federal government and propose suggestions to reduce waste, fraud, and unnecessary expenditures.
Interestingly, the name D.O.G.E actually comes from the Dogecoin community. Musk replied to @Sir Doge Of the coin on Twitter, and this name seemed to inspire him to design the department name. Subsequently, Musk even sent out an image expressing his willingness to serve in this capacity. Trump also responded positively, announcing during a speech at the New York Economic Club on September 6 that if elected president, he would work with Musk to establish a government efficiency committee.
This news undoubtedly brings new traffic potential to Dogecoin—political traffic. As the election results approach, the 'political marriage' between Trump and Musk has become the focal point of market attention. Dogecoin, as the 'mascot' of this event, saw its price soar. After Musk discussed the D.O.G.E plan again during a speech at the Pennsylvania City Hall, Dogecoin's price surged over 15%.
3. The 'win-win' gamble between Musk and Trump
The collaboration between Musk and Trump is undoubtedly a 'win-win' gamble. For Musk, he can enhance his influence in the political arena by supporting Trump. Trump can leverage Musk's wealth and influence to raise funds for his campaign and attract more voter support.
More importantly, if Trump successfully becomes president and fulfills his promise to let Musk oversee the government regulatory department directly impacting Tesla and his other business operations, Musk will be able to gain enormous economic benefits. After all, the development of companies like Tesla in the United States is largely influenced by government policy. As the head of the government efficiency department, Musk will undoubtedly have a greater say in promoting policies favorable to his businesses.
Of course, this gamble also carries certain risks. If Trump fails to be elected president or if Musk encounters resistance in the reforms of the government efficiency department, their cooperation may face failure. The price of Dogecoin may also be affected and see a significant drop.
4. The future outlook of Dogecoin
Despite the significant price fluctuations of Dogecoin, as a community-driven cryptocurrency, it still possesses certain market potential. As Musk and Trump's collaboration deepens, Dogecoin is expected to gain more political traffic and exposure opportunities. If Trump successfully becomes president and promotes reforms in government efficiency, Dogecoin may become one of the beneficiaries of this event.
However, investors also need to be wary of the risks of Dogecoin. Due to its price being greatly influenced by the statements and events involving individuals like Musk, its volatility is relatively high. Additionally, the overall trend of the cryptocurrency market will also impact the price of Dogecoin. If the overall market declines, the price of Dogecoin may also be affected.
Finally, I want to mention that Musk is definitely a master of marketing. He is currently pouring money into helping Trump campaign while boosting the price of Dogecoin. Who is ultimately paying for this? Of course, it’s the group of people investing in Dogecoin, who will definitely become the ones left holding the bag later. After all, how could Musk possibly use his own money? He is using the money of internet users to help himself achieve his goals. Without spending his own money, he can reap huge benefits later, which is indeed his style. So the investment risk in Dogecoin is huge; please be cautious.
Cherish your family and stay away from Ponzi schemes!
