Dogecoin’s Twitter-fuelled surge abates

Edited by mcornell

Meme-inspired cryptocurrency jumped by 31% last week

Elon Musk was primarily responsible for Dogecoin’s stratospheric rise to an $89bn market capitalisation in 2021

Dogecoin traded down day-to-day by 8.3% to $0.09471 by 14:00 (UTC) on Monday, ending a surge that had propelled the cryptocurrency to a 20-day high. 

The meme-inspired coin rose by 31% last week from $0.07262 on Monday to a high of $0.1057 on Sunday, after comments by the billionaire Elon Musk. 

The CEO of Tesla and SpaceX and new owner of Twitter confirmed that he intends to integrate payments as part of his revamp of the platform. 

Although the material released by Twitter made no reference to Dogecoin, traders and investors reacted enthusiastically to the confirmation, given Musk’s positive inclination towards the cryptocurrency seen in the past. 

The South Africa-born Musk was primarily responsible for the joke currency’s stratospheric rise to an $89bn (£74bn) market capitalisation in 2021. He promoted the coin to his large social media following at the height of public interest in the then-burgeoning crypto sector. 

With such enthusiasm having long since abated, Dogecoin traded 87% below its all-time high on Monday, with a market capitalisation of $12.5bn.

Although the frequency of Musk’s pro-DOGE tweets has fallen away, he has continued to support the cryptocurrency. At the end of 2021, he announced that Tesla would accept DOGE as a means of payment for its merchandise. 

Twitter takeover welcomed by crypto sector

Beyond the day-to-day Dogecoin speculation, Musk’s takeover of Twitter has been welcomed as a positive development for the cryptocurrency sector. 

Changpeng Zhao, the CEO of the world’s largest cryptocurrency exchange, Binance, contributed $500m to Musk’s $40bn acquisition in order to give the sector “a seat at the table.”

Zhao has signalled his willingness to join Twitter’s board if necessary and has argued that Musk should support a broad range of cryptocurrencies for payment.

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