Musk intervention drives Dogecoin rally
Dogecoin co-creator Billy Markus welcomed Musk’s continued support for Dogecoin
Although the capitalisation of the total cryptocurrency market rose by 5.5% on Monday, Dogecoin had a headstart on many of its competitors over the weekend, in large part due to SpaceX and Tesla CEO Elon Musk.
Musk tweeted to his almost 99 million followers: “I will keep supporting Dogecoin.” When a Twitter user encouraged Musk to keep buying dogecoin, he replied, “I am.”
As a result, the cryptocurrency soared by as much as 28% to $0.062. The meme-inspired coin had suffered a slump of over 36% in the previous month, caught up in the major sell-off that saw the total cryptocurrency market capitalisation lose $400bn (£327bn) in value.
At $0.059 on Monday afternoon, Dogecoin traded 92% below the $0.7376 all-time high that it reached in May of last year.
Elon Musk was the primary instigator of this record rally, promoting it largely due to the fact that it was created as a joke.
At one point, the cryptocurrency with a circulating supply of 132.67 billion DOGE reached a market capitalisation of $88bn. Appearing on the television programme Saturday Night Live that same week, Musk jokingly admitted: “It’s a hustle”.
With a current market capitalisation of only $7.9bn, Dogecoin may appear to many, including its co-creator Jackson Palmer, to be an unattractive investment.
Palmer, who sold his DOGE holdings long before it skyrocketed, stated in an interview before the recent crypto sell-off: “I think there’s going to need to be a crash. I think we’re well overdue for some sort of pop, and I don’t think it’s going to be a big boom. It’s going to be a lot more painful.”
In contrast, Dogecoin’s other creator, Billy Markus, has welcomed Musk’s interventions. In response to the South Africa-born billionaire’s latest statement, Markus said:
“You’ve always been earnest about supporting the coin for what I consider the right reasons – you find it amusing, appreciate the satire and irony, and you think it has potential as a currency – and your companies accept it for merch, giving it more utility.”