Is Dogecoin (DOGE) Dead?

Contributor, Benzinga

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As you probably know, 2021 saw dozens of dog-themed cryptocurrencies soar. Tokens such as Shiba Inu (SHIB) and Floki Inu (FLOKI) appreciated enormously in the past year. Almost all these dog-related tokens can be traced back to Dogecoin (DOGE). However, many of these tokens have gone down significantly, and investors lost money. Dogecoin has become fairly stagnant in recent months, leading many investors to question whether or not the coin still has room for appreciation. Will Dogecoin rebound or will it continue on a downtrend?

Why Is Dogecoin (DOGE) Down?

In the past 6 months, Dogecoin is down over 55%. It has come down significantly after hitting all-time highs of around $0.70 in May 2021. Many speculate that this price action was caused by a mass selloff after the coin appreciated tremendously in the first half of 2021.

Another factor that may impact DOGE’s price is Robinhood Markets Inc. (NASDAQ: HOOD). Robinhood houses a large portion of the Dogecoin market, and investors have recently begun to sell their positions in the token. Robinhood had previously earned 32% of its total revenue from Dogecoin transactions. However, in late October 2021 the brokerage announced that Dogecoin revenue is now at 8%. There are fewer Dogecoin transactions on Robinhood than earlier this year, a massive platform for Dogecoin trades.

Dogecoin may also be negatively impacted by the rise of other dog-themed memecoins. Shiba Inu (SHIB) recently stole the show from Dogecoin by surpassing DOGE’s market capitalization. Because DOGE has been depreciating over the past several months, many investors may be looking towards other memecoins in order to seek profits. 

Dogecoin (DOGE) Price Movements

In early 2021, Dogecoin shot up from less than $0.01 to almost $0.75. Investors that bought in the project early saw massive gains. These investors may have then decided to sell their investments, causing the price to crash below $0.18 for a short time. 

In November 2021, Dogecoin went down about 60% from its highs in May 2021. Some speculated that it may be a good time to buy the token for a discount, while others see the drop as the beginning of the end for the token. In June of 2022 the token sits just above $0.06.

Those who say that the project will rebound say that Dogecoin is still an extremely popular project. Dogecoin has consistently been in or around the top 10 cryptocurrencies by market capitalization. Investors currently have over $30 billion in the project. This level of investment may give the project more life long term and make it a better investment.

Conversely, those who say that the project is dead cite other memecoins and lack of utility. Shiba Inu passed Dogecoin, and many investors are starting to look towards other memecoins. Dog-themed tokens are popping up everywhere. With each new token released, money may be moving away from DOGE and into these new projects. Dogecoin also has a lack of utility. As of right now, the only real use of Dogecoin is as a form of payment. Some say that this lack of use cannot justify a price increase.

Traders debate Dogecoin’s utility and where its price will go. Supporters say that its popularity will prevail, while opponents say that a lack of uses and new tokens will lead to DOGE’s demise.

Cryptocurrency Market Cycle

The crypto market reached all-time highs in October 2021. Tokens such as Bitcoin (BTC) and Ethereum (ETH) broke records. A lot of positive sentiment surrounded the larger tokens. 

In terms of the crypto cycle, we may be due for a reversal. In the past, all-time highs have been followed by downtrends. While this reaction occurred in the past, it does not mean it will happen now. The market could go either up or down.

One way the crypto market can be measured is by comparing Bitcoin to altcoins. When altcoins outperform Bitcoin, it is referred to as “alt season.” According to Blockchain Center, we are not currently in an altcoin season. Both Bitcoin and altcoins are performing well, but the mania surrounding altcoins has yet to come into full effect.

Where To Buy Dogecoin (DOGE)

Dogecoin is an extremely popular project and is offered on a variety of centralized exchanges (CEXs) and decentralized exchanges (DEX). A CEX is better suited for beginner investors looking to quickly and easily purchase DOGE. 

While there are a handful of CEXs that offer DOGE, eToro, Coinbase Global Inc. (NASDAQ: COIN), Gemini and Webull are among the best because of their security, transaction fees and ease of use. To open an account on a CEX, you need an email and password. Once you have created an account, you may have to provide some basic personal information in adherence to Know Your Customer (KYC) laws. 

Buying Dogecoin on a DEX may be better suited for advanced crypto users focused on safety and security. You need a wallet to obtain DOGE. Make sure to check out our guide on the best cryptocurrency wallets if you choose to go this route. With your wallet, you navigate to a DEX and swap a cryptocurrency for DOGE.

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Bonus: Keep an eye on Dogecoin’s market cap. This component may be a good indicator of market sentiment and could play a role in where the price goes. 

So, Is Dogecoin (DOGE) Dead?

As of right now, it is hard to say for certain whether or not Dogecoin is dead. You can find reasons to support both sides of the argument. The token’s immense popularity could drive another price run, but new memecoins could attract some of DOGE’s investors. If you are willing to take on a risky investment, DOGE could still have room for growth. However, do not expect price increases similar to those of early 2021.

Frequently Asked Questions

Q

Who invented Dogecoin?

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Who invented Dogecoin?
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A
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Dogecoin was developed by software engineers Billy Markus and Jackson Palmer.

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