As the market opens this morning Dogecoin, along with Bitcoin, Ethereum and other cryptocurrencies worldwide, appears to be rallying after a sweeping crash saw a massive price drop and tumbling value for the meme coin.
The crash came as the Chinese government pledged to clamp down on the country’s huge mining operations – which have increased exponentially as prices continued to soar over recent months.
While recovering profits are good news for investors and crypto fans, this latest bout of volatility has added to rising fears over the long term health and sustainability of the crypto market and whether there’s more instability to come.
Particularly, usual trading trends of ‘hodling’ (refusing to sell or exchange cryptocurrency when prices plummet) and ‘buying the dip’ are under strain due to the prolonged period of falling prices.
What is Dogecoin and what’s happened?
Much like bitcoin, dogecoin is an open-source cryptocurrency which can be traded and exchanged across decentralised peer to peer networks between users, with tokens of value reaped as rewards for users operating in lieu of banks or governments to ensure the validity of its transactions.
Where this coin differs to bitcoin, tether or Ethereum is that it has spread like wildfire on account of its meme origins and appreciation by Tesla founder and cryptocurrency afficionado Elon Musk.
The irreverent tech billionaire earlier this year sent the crypto market into a tailspin when he announced that Tesla would be suspending bitcoin payments for its vehicles due to the currency’s considerable environmental impact.
The familiar shiba inu ‘doge’ meme which fuelled the rise of dogecoin has been circulated far and wide across the internet for years, making its way into the cryptocurrency market in 2013 as a satirical take on the booming popularity around more traditional coins like bitcoin.
But the coin has come full circle, with it now being taken just as seriously as its crypto competitors after its visibility increased worldwide over the last few years.
How much is it currently worth?
Dogecoin’s price bounced back from the red on Tuesday night and Wednesday morning after CoinDesk recorded a 24 hour low for the coin of £0.117023.
Today, its value is fluctuating around a more stable threshold of £0.156929 ($0.219120) – with the coin now up almost 15% on the last 24 hours.
Yesterday’s figure saw its biggest dip in the last 30 days after its value skyrocketed in May to an all time high of £0.533187.
Since Monday (June 21), its value had tumbled by around 25%.
Will Dogecoin and other cryptocurrencies recover?
Dogecoin price predictions following this latest tumble have put hopes of the coin finally reaching $1 worth or above anytime soon slightly further out of reach.
The closest the cryptocurrency has come to nearing that landmark threshold was seen in early May, before China’s latest moves to stunt the flow of transactions and mining began to shake the market.
Bitcoin fell below $30,000 on Tuesday to a 24 hour low of $28,814.75, putting it at the lowest value since the year began.
Several big players in the market are keen to make the most of falling profits despite concerns around increased volatility, with Microstrategy CEO Michael Saylor buying over 100,000 bitcoins valued at over $3 billion.
Saylor’s actions mirror many of those hoping to help Bitcoin and smaller coins it has taken down with it to bounce back against plummeting profits.
Additional reporting by Reuters journalist Julien Ponthus