Dogecoin is on a run, spikes 400% in a week, and is headed to the moon

Just as the popular virtual currencies such Bitcoin and Ethereum have surged in value this week, so has Dogecoin — a cryptocurrency started in 2013 as an internet parody. Oh, yes, Dogecoin is spiking. The joke currency, boosted by the likes of Elon Musk and Mark Cuban, which as recently as January 27th was worth less than a cent, hit 47 cents this morning, according to Robinhood’s tracker. As I type this, the market cap is more than $38 billion and now it’s a top 10 digital currency. To be precise, its current CoinMarketCap ranking is #8.

The cryptocurrency is based on the “Doge” meme and started as a “fun” alternative to Bitcoin rose to popularity in late 2013. The meme portrays a Shiba Inu dog alongside nonsensical phrases in multicolored, Comic Sans-font text. Created in 2013 by software engineers Billy Markus and Jackson Palmer, Dogecoin was intended to be used as a faster but “fun” alternative to bitcoin, but it has since found a growing community online.

And now, defying all odds, dogecoin has a total market value of more than $40 billion, according to crypto market data site CoinGecko, adding over $20 billion in the last 24 hours. The digital token reached an all-time high of 32 cents Friday morning, more than doubling in price from a day ago, though must take note that it’s not the first time dogecoin has seen a wild climb. Like many cryptocurrencies, it has a tendency for volatile swings in price.

In 2018, dogecoin’s price began rising in tandem with other popular digital currencies. It’s been fairly off the radar since then. But earlier this year, dogecoin skyrocketed on the back of enthusiasm from a Reddit group called SatoshiStreetBets. Similar to the subreddit WallStreetBets, which helped fuel a rally in GameStop shares at the start of 2021, SatoshiStreetBets aims to pump up the prices of cryptocurrencies.

Dogecoin has been climbing again in the past week, hitting 10 cents a coin for the first time on Wednesday. It’s risen by a whopping 400% in the last seven days. On Friday, a Reddit user posted a picture of their dogecoin holdings on the Robinhood investing app. “Hey guys I just became a Dogecoin millionaire,” the user said, showing a balance of $1,081,441.29 in their account.

Why is dogecoin rallying?

For one, there’s the Coinbase listing. The most popular U.S. virtual currency exchange went public on Wednesday, briefly hitting a $100 billion market cap in a landmark moment for cryptocurrencies. The excitement around Coinbase’s debut led to a surge in the prices of bitcoin and ether. Bitcoin hit a record high of more than $64,000 on Thursday, while ether briefly topped $2,500 for the first time Friday morning. Dogecoin has been no exception to the frenzied interest in these digital assets.

Dogecoin has attracted a following among users of Robinhood. On Thursday, the U.S. online brokerage said there was a “major outage” in its crypto trading feature after facing “unprecedented demand.” The feature is now back online, Robinhood said. Some reports have attributed the latest dogecoin rally to support for the meme-based token from Tesla CEO Elon Musk. He has made several tweets about dogecoin, which in turn has helped push up its price.

On Thursday, Musk posted a cryptic tweet saying “Doge Barking at the Moon,” likely in reference to the popular crypto slang phrase “to the moon.”

The billionaire has called dogecoin his “fav” cryptocurrency and “the people’s crypto.” Musk has also come out as a supporter of bitcoin, with his electric car company buying $1.5 billion worth of the cryptocurrency earlier this year. But his tweets have worried some investors, given their apparent ability to move markets. Some bitcoin investors, for instance, have sounded the alarm about Musk’s dogecoin tweets. Nic Carter, the co-founder of Castle Island Ventures, warned retail investors “are going to lose money on dogecoin,” calling it a “vehicle for speculation.”