The cryptocurrency created as a parody to cryptos has recently seen a great jump in its value. This was all because of the tweets by the billionaire Elon Musk. Let’s look into its history, stats, and solution for the recent crash.
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Dogecoin was created by IBM software engineer Billy Markus and Adobe software engineer Jackson Palmer. Dogecoin was launched on December 6th, 2013 officially. It had seen a similar rise of 300% in its value during its starting days. It crashed by 80% just days later.
Till the year 2020 Dogecoin was rising steadily. Dogecoin went up 800% in a day, reaching a price of $0.07. It was a result of attention from Reddit users, partially encouraged by Elon Musk and the GameStop short squeeze. Celebs like Musk, Snoop Dogg, and Gene Simmons had hyped it up and the value increased greatly in February.
In April Dogecoin’s market capitalization reached $50 billion, making it the fifth-highest-valued cryptocurrency. Its value had increased by more than 7,000% year-to-date.
On May 4, 2021, the value of Dogecoin passed $0.50 which is almost a 20,000% increase in one year.
On May 8, 2021, Dogecoin dropped from $.711 to below $.470 45 in minutes. The next morning Dogecoin hit $0.401, a drop of 43.6% and a lost value of $35 Billion. This was related to Elon Musk’s SNL interview.
Originally it was used only for peer-to-peer lending. As Doge got famous and its value increased, more and more businesses and banks started accepting it. Some of its uses are for tipping on the net, gambling, and buying electric cars. NBA accepted Dogecoin for buying tickets in march, 2021.
Should you DUMP it?
Its value drops by 43% just 3 days after hitting its maximum price point. This shows us that Doge has still not stabilized and is highly unpredictable. Another problem with Doge is that it can be mined infinitely which will decrease its value in long run. You could end up losing more of your money as a result.
Due to herd mentality, people just bought Doge without taking some of the above-listed points into consideration. Common people bought Doge in a frenzy and helped in increasing its value. The billionaire who hyped up the crypto is now made a profit on his coins while others are just losing their money now.
What can happen if you HOLD?
Since its value has not stabilized yet, doge may continue to fall down due to this sudden loss in its value. Dogecoin’s value may fall down by more than half of what it is at now. Holding your coins for a very long time may help in getting your returns back. But due to the inflation rate adjusted to a long term, you just might end up losing more year by year.
Try to invest in stable cryptocurrencies or long-term stocks instead of volatile coins like these.
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