Dogecoin, driven by Elon Musk and Mark Cuban, rallied more than 110 percent on Friday before falling 26 percent on Saturday, according to CoinMarketCap.com. It now has a market value of over $ 36 billion and is still up 13,400% from a year ago, when it traded at $ 0.002 and was worth about $ 250 million.
The demand was so strong for the token that investors trying to trade Robinhood collapsed the site, the online exchange said in a blog post on Friday. Dogecoin worth about $ 68 billion has changed hands in the last 24 hours since 4:45 p.m. Friday in New York, most since June, CoinMarketCap.com data have shown.
Doge’s rise is part of an increase in altcoins, a term for all digital chips that have appeared in imitation of Bitcoin. Like most of them, its use case is limited, making it a tool for speculators and creating concern that a bubble is swelling in a crypto world now worth more than $ 2.25 trillion. .
“This reminds me of the dot com days. I knew something big was happening, many investors were following it hard. This has led to a bubble, “said Scott Knapp, chief market strategist at CUNA Mutual Group.” For every Amazon.com there were 10 pets.com that went bankrupt. Is Dogecoin pets.com from the era of cryptocurrencies? “
Interest in cryptocurrencies is growing again after companies from PayPal to Square began allowing Bitcoin transactions on their systems, and Wall Street firms such as Morgan Stanley began offering access to chips to some of the most rich customers. Over time, cryptocurrencies that say blockchain technology will reconfirm the financial community have connected crypto, enriching themselves in the process.
The Shiba-Inu-themed dogecoin was created as a joke by software engineers Billy Markus and Jackson Palmer in 2013. Musk launched a rally earlier this year when he posted a photo of a fake “Dogue” magazine with a dog in it. a red sweater.
But Michael Novogratz, CEO of Galaxy Digital Holdings, is not buying hype because Dogecoin “doesn’t really have a purpose.”
“It’s reminiscent of GameStop,” he said in an interview with Bloomberg TV, referring to the mania of meme stocks that swept the markets in February. “I’d be very, very worried if one of my friends invested in Dogecoin on these prices”.
With little to support the case of buying cryptocurrencies, the likelihood of them rising remains high, leaving novice traders who have jumped on the hype vulnerable to steep losses.
“The government has pumped so many monetary and fiscal incentives into the economy now, even worthless assets are being auctioned off,” said Michael O’Rourke, chief market strategist at JonesTrading.
However, the popularity of the alt-coin is hard to ignore. While Bitcoin is worth more than $ 1 trillion, the total market ceiling of the symbolic universe now exceeds $ 2.25 trillion, according to CoinGecko.com, which tracks more than 6,700 coins.
Bitcoin’s dominance in the crypto world has fallen 28% since the beginning of the year, according to OKEX Insights analyst Robbie Liu, citing data from Tradingview. The declining influence began to accelerate this month, he said in an email on Friday, and Bitcoin now accounts for less than 54% of the capitalization of the cryptocurrency market – the lowest level in almost two years.
“As for altcoins, we continue to see a strong momentum,” Pankaj Balani, CEO of Delta Exchange, a cryptocurrency exchange, said in a note Thursday. He noted Ether’s recent record and increased activity in decentralized finance or DeFi, adding that “decentralized currencies will be the focus of attention in the next few days, given that the market has validated Coinbase at a valuation of $ 100 billion. ”.
Other chips without fundamental funds are growing. Cardano and Polkadot, both in the top 10 cryptocurrencies by market capitalization, rose this week.
“Polkadot and Cardano have very few ‘users’ at present,” Shashwat Gupta, founder of Altcoinbuzz.io, said in an email on Wednesday, adding that a substantial amount of development is developing on them.
And it seems that Coinbase CEO Brian Armstrong could have come close to saying when he said after the listing that it marks a “change of legitimacy” for crypto.
Coinbase’s listing “will ultimately provide more” use cases “for cryptos and should sustain the growth of the cryptographic market,” said Edward Moya, senior market analyst for North America at Oanda Corp.