SINGAPORE, Nov 8 (Reuters) – It is no joke. Elon Musk’s acquisition of Twitter has put contemporary wind within the sails of dogecoin, the meme cryptocurrency he catapulted to fame.
Dogecoin’s value doubled after the Tesla tycoon completed the $44 billion deal. It was buying and selling at about $0.07 on Oct. 27 earlier than Musk tweeted “the hen is freed” to announce his possession. 5 days later, it was at $0.16.
That will not sound like a lot, however it gave the extremely unstable cryptocurrency a market worth of $21 billion, based on information platform CoinGecko.
Not unhealthy for a coin that was created as a “joke” satirizing wild hypothesis within the crypto market and named after an web meme of a Shiba Inu canine.
“Buying and selling dogecoin round Elon tweets has change into a profitable type of hypothesis,” mentioned Matthew Dibb, chief working officer of Singapore-based crypto funding supervisor Stack Funds.
Musk has certainly performed a giant function within the rise of dogecoin since its lighthearted launch by two software program engineers in 2013. His tweets expressing assist for the coin, together with one calling it the “individuals’s crypto”, helped its value come from nearly nowhere to surge about 4,000% in 2021.
Crypto watchers mentioned the most recent value soar, following the Twitter deal, was fuelled by investor bets that Musk would make doge part of the platform’s funds system.
“There’s plenty of hypothesis that Twitter will present a check mattress for doge adoption and experimentation for various makes use of,” Dibb added.
DOGE AND SHIB
Dogecoin , has since misplaced a few of its beneficial properties and is hovering at about $0.12, which makes it the eight-biggest cryptocurrency, with a market cap of round $16 billion, based on CoinGecko.
The so-called meme coin hit a peak of $0.63 in Might final yr, however macro gloom and investor apathy to dangerous markets have since crushed it together with different outstanding crypto belongings comparable to bitcoin and ether . Even after the most recent rally, doge is down 57% up to now 12 months.
Nonetheless, crypto market information web site Coindesk mentioned the doubling of its value had made doge the highest performer amongst 150 digital belongings in its CoinDesk Market Index in October.
Its share of the $1 trillion international crypto market cap by way of the yr till the top of October was 1%, a fraction of bitcoin’s 39%, based on CoinMarketCap. Now it is at 1.58%.
Doge has lifted different dog-themed cash in its wake, mainly Shiba Inu , which has the identical motif of the Japanese canine breed as doge and is designed to be suitable on the Ethereum blockchain. Shib, which trades at simply $0.00001, jumped by a 3rd within the days after Musk closed the Twitter deal.
In contrast to bitcoin, each doge and shib have close to limitless provides, which means it could take greater than mere speculative hoarding to drive their costs up.
AT MERCY OF MUSK?
Bets that Musk might enable crypto funds with canine tokens have been kindled by his tweet final week of an image of the Shiba Inu canine carrying a Twitter T-shirt.
But the early rally has stalled, with many crypto buyers stumped about how severe he actually is about dogecoin.
Musk, the world’s richest particular person, referred to as dogecoin a “hustle” on a talkshow in Might final yr, as an illustration, sending the worth tumbling.
Then in January this yr, Tesla began accepting dogecoin as fee for its merchandise, such because the “Giga Texas” belt buckles and mini fashions of electrical autos.
Musk’s newly launched fragrance “Burnt Hair” will also be purchased with doge.
Reporting by Vidya Ranganathan; Enhancing by Pravin Char
Our Requirements: The Thomson Reuters Trust Principles.