The cryptocurrency that started as an internet meme has once again captured the headlines as the price of Dogecoin (DOGE) has skyrocketed in the past 7 days and has surged by 25% in the past 24 hours.
The US election has apparently set off a new chapter for this meme coin, possibly as Elon Musk’s fondness for DOGE and support for Donald Trump have provided the fuel needed to propel the price to new heights.
Data from CoinMarketCap indicates that DOGE’s value has nearly doubled in these past 7 days while the token has accumulated gains of 245% since the year started. As a result, it is currently ranked 6th among all cryptocurrencies in terms of market cap, surpassing other well-established digital assets with much more practical utility and economic value like USDC and XRP.
These weekly gains have also made DOGE the best-performing digital asset among the top 20 most valuable cryptocurrencies followed by Cardano (ADA), Shiba Inu (SHIB), and Sui (SUI), the three of which have experienced similar upticks of 70%, 56%, and 47% respectively.
DOGE is Riding The “Trump Bump”
The crypto markets have responded positively to Donald Trump’s win and enthusiasm for the sector appears to have increased in a phenomenon deemed by observers as the “Trump bump.”
One of the most interesting developments that have linked Musk, Trump, and DOGE is the name that the head of Tesla (TSLA) opted to give to the government initiative he was supposed to oversee for the Trump administration – the Department of Governmental Efficiency, whose initials are D.O.G.E.
“Dogecoin specifically could also be rallying on the very real prospects that Elon Musk could be appointed to head the Department of Government Efficiency in a Trump admin,” said Nic Puckrin, co-founder and CEO of the crypto education platform Coin Bureau.
Note that a Trump staffer weighed in soon after the election was called, saying that Musk would not be appointed to any such position (and it probably wasn’t legally feasible anyway). Instead, he said that Musk would be in charge of writing code to improve government efficiency. This may just be a cover to allow Musk’s influence over the government without otherwise necessary legal backing, but only Trump’s team knows for sure.
There has been a big wave of speculation that Trump could push the federal government to embrace crypto assets to an unprecedented level. Although it is highly unlikely that DOGE will become an accepted means of payment in the United States for government programs, investors seem to be just playing along the whole narrative.
Then again, Musk revealed that Trump brought him along to meet with (or call) various foreign leaders so it certainly seems like he will have significant influence over the president-elect. That shouldn’t be all that surprising given Trump’s history of (alleged) quid-pro-quo deals and the $130 million that Musk poured into the election for him.
“Trump has largely been seen as extremely positive for the cryptocurrency markets, and any indication of a possible victory will likely push prices up extremely quickly in anticipation of a flood of capital being deployed,” explained Chris Chung, CEO of Titan, a decentralized exchange aggregator.
The Humble Origins of Dogecoin
Dogecoin’s rise to prominence is a testament to the power of internet culture and the unpredictable nature of the cryptocurrency market.
The coin was created in 2013 by software engineers Billy Markus and Jackson Palmer as a lighthearted parody of Bitcoin and other digital currencies.
The name “Dogecoin” was inspired by the popular “Doge” internet meme, which features a Shiba Inu dog as its central character.
The coin was intended to be a fun and accessible alternative to tokens that promoted a much more technical value proposition and its primary focus was on building a community of loyal fans, promoting charitable events for pets, and uncovering the power of meme-based marketing.
Despite its humble beginnings, Dogecoin has managed to carve out a significant niche within the crypto ecosystem and is considered by many the “Genesis” meme coin that gave birth to so many similar tokens lately.
The coin has gained a loyal following among cryptocurrency enthusiasts, who have embraced its playful branding and the sense of community that has been developed around it.
Elon Musk’s Influence on Dogecoin Over the Years
Elon Musk has been fond of Dogecoin (DOGE) since 2020 when the pandemic and the loose monetary policy that the health crisis forced managed to propel the value of crypto assets to their highest levels on record.
He often published cryptic messages that were quickly linked to DOGE and his remarks often caused temporary spikes in the price of the crypto asset. However, he was never involved directly in the project nor his companies have invested in the meme coin either.
— Elon Musk (@elonmusk) October 29, 2024
He did confirm in 2021 that he held Dogecoin tokens and further affirmed that he owned a bunch of them earlier this year.
Musk’s newfound political influence, coupled with his affinity for the meme coin, has led many investors to believe that Dogecoin could see even greater mainstream adoption and price appreciation in the coming years.
A Word of Caution from Experts About the Meme Coin Phenomenon
As meme coins once again capture the attention of news outlets and the general public, this could propel mainstream adoption of digital assets alongside a pro-crypto administration.
However, experts are also once again cautioning late adopters to understand the risks involved when pouring money into these assets. Volatility is the name of the game when it comes to meme coins and gains can come as easily as they come, especially for less established tokens.
Moreover, the space has seen a great deal of fraudulent projects being created as a result of the launch of platforms like the Solana-based pump.fun – a token-minting protocol that facilitates the process of creating and launching these assets.
“I’d urge long-term investors to not place too much emphasis on memecoin activity,” warned Ryan Rasmussen, head of research at Bitwise Asset Management. “In the long term, there will be very few winners in the memecoin market, and with thousands of coins launching daily, picking a specific memecoin is akin to buying a lotto ticket.”
Investors Believed in Trump’s Bid to Turn America Into the “Crypto Capital of the World”
As DOGE and meme coins as a whole appear to be entering a new bullish cycle, the crypto community is likely keeping track of how Donald Trump delivers on his bold promises of aiding the sector by introducing a comprehensive regulatory framework that helps the different crypto companies that operate in the US.
Also read: Bitcoin Surges to Record High as Traders Welcome Trump Victory
Trump claimed that he will turn America into the “crypto capital of the world” and meme coins will surely bank on this statement… if it turns out to be true.
The surge that DOGE has experienced lately reminds investors of the unpredictable and volatile nature of digital assets. Those who have had to stomach to endure the difficult years that came before may be reaping the rewards of their discipline this year.