Musk giveth and Musk taketh away
Dogecoin, the cryptocurrency that started as a joke in 2013, experienced a resurgence thanks to Elon Musk. He tweeted up a storm around December 2020. His huge following on Twitter caused an increase in trading volume and price.
While Dogecoin has been around for a while, it is by no means an innovator in the cryptocurrency space. Its founders are no longer involved with the project. There aren’t any concrete plans for further adoption. Unlike Bitcoin, it does not have any built in scarcity. Dogecoin is inflationary, meaning tokens are minted every single day.
While this might make it easier to use in transactions, there aren’t many places that accept Doge as payment. Its rise instead fit with our distrust of large corporate investors. In response to large shorts on Gamestop, many people bought and held stocks. By doing this, people tried to drive the price up to and bankrupt the short-sellers. Dogecoin is another one of these feel-good meme-able stories.
On the Clubhouse platform, Musk proclaimed:
“Arguably the most entertaining outcome, the most ironic outcome, would be that Dogecoin becomes the currency of Earth of the future.”
Since April, the price sky-rocketed again, from under 0.1 USD to an all-time high of 0.74 USD. Then Saturday Night Live announced that Elon Musk would host the iconic show. Could the price finally hit 1.00 USD? Within less than 24 hours of Musk hosting the show, the price dropped more than 20%.
It’s weird enough that Elon Musk was invited to host a comedy show. Musk began a monologue, finishing by bringing his mother on stage. He made a joke about buying her Dogecoin for Mother’s Day. Dogecoin’s value fell off a cliff.
A decentralized currency like Dogecoin allows individuals to retain more power and control over their money. It provides fewer restrictions than centralized currencies. This begs the question, what is the value of Dogecoin if it’s so volatile? Is it truly decentralized if it can be so strongly influenced by one public figure?
I don’t want to hold any currency or investments that are this volatile. Musk, who isn’t affiliated with Dogecoin in any capacity is still a huge driver of its price. What seems like fun tweets, jokes and memes do affect people’s finances and lives.
Coinsmart. Beste Bitcoin-Börse in Europa
Source: https://medium.datadriveninvestor.com/dogecoin-down-after-elon-musks-saturday-night-live-stint-9f9b2e2aea12?source=rss——-8—————–cryptocurrency