Dogecoin continued to plunge on Tuesday as cryptocurrencies tumbled in the wake of a fresh crackdown by Chinese authorities.
The meme cryptocurrency lost 20% over 24 hours to hit $0.19431, according to CoinGecko. That was around 74% lower than its record high of more than $0.70, reached in May amid expectations that Elon Musk would use his “Saturday Night Live” performance to pump the token.
The dogecoin market was worth around $94 billion at its peak, but had dropped to roughly $25 billion on Tuesday, according to CoinGecko – a $69 billion loss.
Dogecoin suffered the heaviest losses of any major cryptocurrency on Tuesday. Yet others didn’t fare much better, with binance coin and cardano off by around 12%. Bitcoin and ether, the two biggest cryptocurrencies, dropped but less sharply.
Cryptocurrencies have fallen dramatically since May after Elon Musk halted payments for Tesla in bitcoin, citing its “insane” energy use, and China started cracking down on crypto “mining.”
Yet dogecoin has been hit particularly hard, with the token plummeting back to earth after skyrocketing in the spring.
Analysts have long warned that dogecoin is a case of speculative mania, with the price influenced more by celebrity-induced buzz than anything fundamental.
Musk was one of the main drivers of the rally in dogecoin. But he hasn’t said anything about doge in a while, and let fans down when he called it a hustle on SNL.
“Many expected Elon Musk’s SNL appearance to send the already-soaring dogecoin even higher,” Michael Kamerman, CEO of crypto firm Skilling, said. “It had the opposite effect.”
“Combined with China’s crackdown on cryptocurrency, the ripple effects are being felt by all digital currencies.” He added: “Whether or not it goes up or down from here is anyone’s guess.”
Nonetheless, dogecoin remained more than 7,000% higher for the last year on Tuesday, according to CoinGecko.
Ethereum cofounder and cardano creator Charles Hoskinson said in a recent podcast that he hopes Elon Musk’s appeal for ideas to upgrade dogecoin will help bring more real-world value to the digital token.
“Dogecoin is a reasonable target for someone to fix it up and make it an interesting cryptocurrency,” he told podcast host Lex Fridman on Friday.
After Musk called on developers to submit ideas for upgrades to the meme token last month, Hoskinson posted a video describing the challenges that come with developing a cryptocurrency like dogecoin.
“My hope is that a compromise can be made where real developers come in, and they start working on doge to create some use and utility for it, so at least it has a value floor and won’t collapse,” Hoskinson said in the podcast.
He predicted it could take two to three years for dogecoin to be able to function as a modern cryptocurrency.
Dogecoin’s popularity has surged this year as influencers, including Musk, promoted the meme-based cryptocurrency on Twitter. Its explosive run higher isn’t seen as reflecting any meaningful value, but rather as driven by buyers hoping that others will pile in and push the price of dogecoin higher, allowing earlier holders to make a quick buck by taking profits.
The digital token was last trading 9% lower at 24 cents on Monday, but it is up about 5,164% so far this year. Dogecoin has reached a market cap of $32 billion, making it the sixth-largest cryptocurrency, despite undergoing little development since its inception in 2013. It was added to Coinbase’s professional trading platform in May.
Hoskinson warned that Musk’s influence over dogecoin’s value could end up significantly hurting retail investors unless its code-base is improved.
Dogecoin may have started as a joke in 2013, but few are laughing at its hefty gains after the famous meme token catapulted to a market valuation of around $90 billion at one point in April.
More recently, Coinbase, the largest cryptocurrency exchange in the US, said retail traders can sell, buy, and store dogecoin. The company, with its 56 million verified users, paired the announcement with plans to give away $1.2 million worth of prizes in dogecoin to encourage users to take advantage of its newest cryptocurrency trading option.
The move came two days after Coinbase said Coinbase Pro users can transfer dogecoin into their accounts. Dogecoin surged 41% on the news.
A tweet from Elon Musk hours after further spurred the token’s rally.
Dogecoin has rocketed nearly 8,000% this year, far surpassing bitcoin’s nearly 30% gain and ether’s 260% climb.
The shiba inu-themed token goes through wild price swings but some analysts do not seem too bothered.
“The price action in doge is extremely volatile but is ultimately driven by supply and demand with real capital,” Jeffrey Wang, head of Americas of Amber Group, a crypto financial services firm, told Insider. “I think the price moves in doge are a great example of free capital markets in action.”
Coinbase joins Gemini and eToro, which both listed the meme token in May this year, as well as Kraken and Binance. Combined, the exchanges effectively open up the meme token to tens of millions of users worldwide.
While the listing is viewed as a stamp of approval by some, others like Peter Jensen, CEO at RocketFuel Blockchain, a global payments company, view the decision of Coinbase as just a strategic business move.
“Exchanges like Coinbase Pro and eToro have enlisted doge only because of the massive inflow of retail user base that dogecoin is getting, which in turn means it’s a profit-generating coin for exchanges,” Jensen told Insider.
Jensen added that unless a major technological upgrade is given to dogecoin, it will remain to be a highly speculative asset without any technological merits.
Here are what eight other experts think of dogecoin’s recent listing:
Wait, but why?
“Dogecoin’s popularity is really just a by-product of the meme-populist age. In essence, it’s a fun way for people to transact and get involved in crypto and investing. Doge is unlikely to have any “use-case” even in the loose sense of the term. It’s important to realize that even the creator Billy Markus sold off all of his dogecoin holdings. Doge can’t compete with bitcoin in the long run because bitcoin has limited supply, and is emerging as a sort of “digital gold.” It can’t square off against ethereum either due to ETH’s smart contract and decentralized app functionality. On its own, it has nothing to offer. So I don’t see this as a watershed moment for dogecoin legitimacy.” – Muneeb Jan, author, Macro Geek Newsletter
“Coinbase is just responding to this popularity. I don’t view dogecoin as being legitimized. Coinbase is an exchange, there are no institutions buying it seriously. Since its supply is unlimited, there are 10,000 new coins mined every minute. This makes it highly inefficient as a legitimate crypto coin except to those that use its volatility to trade it and hang on Elon Musk’s tweets to pump up its value. Even today, Musk’s tweets and mentions of dogecoin seem satirical, not serious. I’m not a fan of hype around dogecoin because it’s a distraction from the useful things being done in blockchain and in crypto, like DeFi.” – Andrew Kiguel, cofounder and CEO, Tokens.com
“We still view this as speculative at best. I think the biggest implication is that many small investors will lose money. The broad crypto landscape, in my opinion, is a combination between a pyramid scheme and the wild west. There are people that will make a lot of money, but there are also a lot of folks who will lose. There are some more legitimate currencies; however, there are also hundreds that are nothing more than ideas. Those that are looking at longer term placeholders for wealth will buy more established cryptos like ether or bitcoin and simply hold.” – Randy Carver, financial expert
“As more crypto brokers begin to offer dogecoin, I see its popularity increasing, but it will take time before it is fully accepted. While socially active, lower account size retail investors are interested in dogecoin and crypto’s in general, active retail investors who trade equities and equity options have largely stayed on the side of crypto trading. With only 50,000 permissible daily transactions of dogecoin, it is a generation away from wider acceptance with retail and institutional investors.” – Dan Raju, CEO, Tradier
It’s about time.
“While a little late, the Coinbase listing is yet another positive sign for the doge community. While it began as a joke, doge’s track record has earned it a place amongst ‘legitimate’ digital assets. While the technology itself hasn’t evolved much, doge has an incredible community and the power of that should not be underestimated. It may have taken Elon Musk and other influential figures to drive awareness and convince institutions of dogecoin’s legitimacy, but as a peer-to-peer network, it’s been widely used for nearly a decade.” – Jason Lau, COO, Okcoin
“The meme currency is now firmly in the mainstream. It’s likely that we’ll see even more interest and adoption from retail investors in the short term, as well as some current doge holders cashing out. Long-term, we simply don’t know; interest in doge may wane, or growing popularity may force traditional financial institutions to re-think what counts as a legitimate asset class. As global adoption continues, the cryptocurrency trading landscape is set to evolve with it. Dogecoin is a representation of how everyday internet users can shape markets when they have the opportunity.” – Philip Gradwell, chief economist, Chainalysis
“Dogecoin getting listed by Coinbase, Gemini, and eToro shows that cryptocurrencies with very strong communities and positive sentiment cannot be ignored, even if they are meme coins. At the end of the day exchanges make money from trades and listing popular cryptocurrencies is good for business as long they are not securities. Liquidity and wide exposure should help dogecoin reach an even larger audience. Originally a meme coin, dogecoin is now a more legitimate digital currency in the eyes of new crypto users than the rest of the field.” – Ian Balina, founder and CEO, Token Metrics
“With the listing of dogecoin on Coinbase, one of the most reputable exchanges, it creates a lot of momentum as well as liquidity. This drives the price up and creates a positive feedback loop on the momentum. I think Coinbase made a significant choice as it ultimately signals that even if coins are created initially as a joke, with enough momentum and a strong community, it can become something much greater. It’s no surprise that doge started as a joke, but with the recent momentum and price action, I think it has created a positive feedback loop of luring back in developers and entrepreneurs and institutions.” – Ben Weiss, CEO, CoinFlip
Dogecoin jumped as much as 41% in the last 24 hour period to $0.4446, the highest point in nearly two weeks, as Coinbase Pro opened up to the meme cryptocurrency.
The cryptocurrency exchange announced on Tuesday it is allowing its Pro users to transfer dogecoin into their accounts. Pro users will be able to trade dogecoin on or after 9 a.m. PT on Thursday if liquidity conditions are met, according to a Coinbase blog post.
The Coinbase Pro account is a free account designed for more experienced traders and offers advanced charting and analytical tools. Dogecoin is not yet available on Coinbase.com or via the consumer mobile apps. The exchange said it would make a separate announcement if and when that support was added.
A new tweet from Elon Musk also added to doge’s rally. At roughly 3:30 am ET Musk tweeted a picture of the doge shiba inu sitting in front of a computer with the quotation “I’ll have to keep my passion hidden from the public or I’ll be socially ostracized.” Musk joked that it was a picture of him as a child.
Dogecoin was trading above $0.42 as of 9:35 a.m ET Wednesday, according to CoinMarketCap. It has fallen significantly from its all-time high above $0.73 reached last month, but it’s still up nearly 7,260% year-to-date. The cryptocurrency which began as a joke, is currently the sixth largest cryptocurrency in the world, with a market capitalization of over $54 billion.
The story behind the world’s largest dogecoin holder may be less fun than social media investors and Elon Musk fans would like.
Ever since dogecoin’s rally this year, news outlets (including Insider) and investors have been pondering who could be behind the $12 billion dogecoin address DH5yaieqoZN36fDVciNyRueRGvGLR3mr7L. It’s accumulated 36.7 billion dogecoins since 2019 and holds about 28% of overall dogecoin supply.
While it’s fun to speculate that the address belongs to a single individual who has been surreptitiously accumulating billions of dollars of the meme currency, it’s more likely that the address is associated with a cryptocurrency exchange, said Patrick Lodder, a dogecoin core developer.
As for the funny additions to the address, like the addition of 420.69 dogecoins to the account on Tuesday, Lodder said those are likely just jokesters sending relatively small amounts of dogecoin to the well-known whale address for fun.
Lodder, who has worked on doge since 2014, clarified that anyone can send doge to a publicly listed address, so money coming into an address is never really a “clue” into the address’ identity unless it’s a very large increase.
“These are all jokers, that probably has nothing to do with the operator of the wallet, that’s just people having fun,” he said of the 420.69 addition, and of the additions of 28.061971 dogecoins three separate times, which reference Elon Musk’s birthday on June 28, 1971.
The whale address has accumulated over $12 billion of doge and very infrequently sells. The last time any doge left the wallet was a sale of 100 million coins in April 2021, the only such transaction of 2021.
CoinDesk’s head of research told Insider this dormant activity could mean the whale is not, in fact, an exchange, and simply an individual. But Lodder said it’s possible this type of activity means the address is a cold storage wallet for an exchange. An exchange that custodies a lot of doge likely won’t keep it on the server, but will offload its holdings into a safer offline storage like a cold wallet. That could also help explain why there’s been plenty of additions to the address but not a lot of selling.
“This looks like somebody getting a lot of money into custody and putting that into a cold storage wallet so that it’s more secure,” Lodder told Insider.
He later said in a follow-up email: “While it is fun to speculate about the ownership of wallets, the only way to be 100% sure of who owns what is when the owner comes forward with (cryptographic) proof. Even if you know everything there is to know about blockchain, there’s always a chance that you come to a wrong conclusion without this proof, so I’d warn everyone to be careful when publishing assumptions.”
People have published plenty of assumptions in online forums about who the address could belong to. One account on Reddit hypothesizes that this whale address could be one of Robinhood’s many dogecoin addresses. The user traces on-chain data and hypothesizes that the address is one of Robinhood’s cold storage wallets.
Despite the Reddit post receiving 4,000 upvotes, there’s still a swath of people who speculate the wallet could belong to the “dogefather” himself, Elon Musk.
Lodder said that it’s highly unlikely the account is a single person, but the best way to clear the air would be for the owner to step forward and claim the address. However, this would be risky considering how much money is in the account.
Like many cryptocurrencies, dogecoin is decentralized. The absence of a central authority is at the heart of crypto’s mission. It makes the asset more secure and less vulnerable to the whims of a single entity, but it also allows for rumours and speculation about the coin to sometimes go unchecked.
Those rumors can be potentially dangerous to a cryptocurrency like doge and it’s loyal investors, said Lodder. Speculation that there’s a whale could cause people to panic-sell in expectation that the whale is going to dump all of their doge, he added.
He said ultimately if the address did belong to an exchange, it would be beneficial to the dogecoin community if the exchange came forward. Most cryptocurrency exchanges don’t disclose their addresses for dogecoin or any other various cryptos.
“It would be helpful for the dogecoin community, not even just doge but all crypto, if there was a good way to either independently verify that the books of a custodial exchange are in order, or to have an audit report from a professional firm that does the audit and certifies that everything is fine,” said Lodder.
He concluded: “That’s a part of compliance that we’re not truly seeing in crypto too often.”
420.69 dogecoins were added to the world’s largest dogecoin address on Tuesday.
No one knows who is behind the address, but the address may have just signaled they are in tune with the jocular spirit of dogecoin, making a nod to meme numbers “420” and “69.”
The address currently holds 36.7 billion dogecoins worth $14.7 billion.
420.69 dogecoins were just added to the world’s largest dogecoin holder, furthering speculation around the identity of the mysterious “whale” who has loaded up on the meme cryptocurrency for two years.
Data from Bitinfocharts shows that on May 18, the dogecoin address DH5yaieqoZN36fDVciNyRueRGvGLR3mr7L added roughly 420.6899 Doge, worth $192.
The address has accumulated 36.7 billion dogecoins since 2019 and now holds about 28% of the total dogecoin supply. With the meme token at $0.3937, the address’ dollar amount currently stands at $14.7 billion.
Investors have been pondering for months who or what is behind the doge wallet. The address could belong to an individual, a market maker, or an exchange, though the nod to the meme numbers “420” and “69,” hint that a person who is in on the joke is making the purchases.
According to Noelle Acheson, CoinDesk’s head of research, a cryptocurrency exchange address would have inflows and outflows. She points out that this address has only been accumulating doge. The address sold 100 million coins on April 12, but that was its only sale in 2021.
Some online forums have speculated the address belongs to the “dogefather” himself, Elon Musk. The address added 28.061971 dogecoins three separate times, which reference Elon Musk’s birthday on June 28, 1971.
Though those transactions could simply be a homage to Musk rather than completed by Musk himself. The Tesla CEO warned in February that the biggest risk facing dogecoin is it’s extreme concentration among just a handful of digital wallets.
The world’s largest dogecoin address-holder purchased 420.69 dogecoins on Tuesday.
No one knows who is behind the address, but the owner holder just signaled they are in tune with the jocular spirit of dogecoin, making a nod to meme numbers “420” and “69.”
The address currently holds 36.7 billion dogecoins worth $14.7 billion.
The world’s largest dogecoin address holder just bought 420.69 dogecoins, furthering speculation around the identity of the mysterious “whale” who has loaded up on the meme cryptocurrency for two years.
Data from Bitinfocharts shows that on May 18, the dogecoin address DH5yaieqoZN36fDVciNyRueRGvGLR3mr7L purchased roughly 420.6899 Doge, worth $192.
The address has accumulated 36.7 billion dogecoins since 2019 and now holds about 28% of the total dogecoin supply. With the meme token at $0.3937, the address’ dollar amount currently stands at $14.7 billion.
Investors have been pondering for months who or what is behind the doge wallet. The address could belong to an individual, a market maker, or an exchange, though the nod to the meme numbers “420” and “69,” hint that a person who is in on the joke is making the purchases.
According to Noelle Acheson, CoinDesk’s head of research, a cryptocurrency exchange address would have inflows and outflows. She points out that this address has only been accumulating doge. The address sold 100 million coins on April 12, but that was its only sale in 2021.
Some online forums have speculated the address belongs to the “dogefather” himself, Elon Musk. The address added 28.061971 dogecoins three separate times, which reference Elon Musk’s birthday on June 28, 1971.
Though those purchases could simply be a homage to Musk rather than completed by Musk himself. The Tesla CEO warned in February that the biggest risk facing dogecoin is it’s extreme concentration among just a handful of digital wallets.
Dogecoin spiked 30% after Elon Musk said on Thursday that he might accept it as a payment method for Tesla. That followed his announcement on Wednesday that he’d stop allowing bitcoin payments for Tesla products over environmental concerns.
Dogecoin had risen by 30.2%, to $0.54, as of 8:20 a.m. on Friday in New York, according to CoinBase. It initially jumped on Thursday evening after Musk tweeted about considering the cryptocurrency as a payment method for Tesla.
“Working with Doge devs to improve system transaction efficiency,” he said. “Potentially promising.”
Dogecoin is the fourth-largest cryptocurrency by market capitalization. After Musk’s tweet, the value of the dogecoin market rose by over $10 billion, to about $67 billion, as trading volume accelerated.
The token, which started as a joke in 2013 and is often described as a “meme coin,” has rallied since early April, reaching a record high of $0.731578 on May 8. It has made year-on-year gains of 20,987.6%.
Musk said he’d look into more environmentally friendly cryptocurrencies to use instead of bitcoin. He said that while he believed in crypto, he was concerned about fossil fuels used in mining.
On top of dogecoin, Musk could explore cryptocurrencies including ether, Cardano’s ADA, XRP, and chia, all of which have a smaller environmental footprint than bitcoin.
Researchers and the crypto community are divided on bitcoin’s environmental impact. Cathie Wood’s Ark Invest published research on Thursday arguing that bitcoin mining actually helped the environment, whereas Bank of America said earlier this year that bitcoin used more energy in a year than American Airlines.
Tesla shares were up by 1.98% in premarket trading on Friday.
Dogecoin investors eagerly awaited Elon Musk’s Saturday Night Live skit last week, expecting his remarks to send the meme-coin to new highs.
Quite the opposite happened. Not only did the cryptocurrency tank 30% over the weekend, but the Dogecoin community was led on by con artists attempting to trick them out of their holdings.
A report published by blockchain intelligence provider TRM Labs detailed how the fraudsters manipulated Musk’s promotion of the digital currency, pocketing dogecoin worth $5 million at the time of the scam.
Here’s how the scam worked:
During the SNL telecast, viewers who searched for “Elon Musk SNL” on YouTube could see multiple livestreams that seemed to be hosted by the NBC show. They were actually being run by scammers.
The livestreams publicized links to unique websites that viewers could visit to receive dogecoin.
A message carried on the broadcasts read: “Elon Musk has devoted 500,000,000 DOGE to be distributed to all DOGE holders. Anybody can get some, just visit the website.”
This was perhaps somewhat believable as his followers expected the billionaire’s SNL hosting would pump the digital asset.
TRM Labs
Users were asked to transfer dogecoin to a specified blockchain address with the assurance that they would receive double the amount sent.
TRM Labs
As of May 9, the report showed scammer addresses received about 9.7 million dogecoin worth $5 million at the time. Initial findings noted most inflows were sent to the wallets by the owners themselves, falsely creating the illusion that they were legitimate accounts.
Most of these videos were taken down on Sunday in an attempt to cover any tracks.
One victim that fell for the scam warned others on the Dogecoin subreddit, saying: “Don’t fall for it like I did. The website won’t send you back twice the amount of coins you send them. I just went from having savings for this first time in my life to 60 bucks left in my pocket.”
“Giveaway scams are not new,” TRM Labs said. “According to the FBI, Mass Marketing Fraud schemes – like crypto giveaway scams – ‘victimize millions of Americans each year and generate losses in the hundreds of millions of dollars.'”
Dogecoin rebounds after Musk hints Tesla could accept it as payment
The digital asset recouped some losses by climbing as much as 20% to 55 cents on Tuesday. Musk ran a poll asking his followers whether they wanted his electric-vehicle maker to accept dogecoin as payment.
Most respondents said “Yes,” while about 20% didn’t think it was a good idea.
“As much of the value in Doge is speculative or perception driven, Elon seems to have anointed Doge as the de facto cryptocurrency with what seems to be a half-humorous, half-financial decision,” Edozié Izegbu, founder and managing director of digital-art for crypto platform Chimera, said. “The real question to be wary of is how long can this joke last.”
The meme-inspired cryptocurrency is up more than 11,000% so far this year, while bitcoin is up 90%.
SpaceX is launching a mission to the moon in 2022, and has accepted meme cryptocurrency dogecoin as payment to take a payload on the journey.
Geometric Energy Corp, an intellectual property, manufacturing and logistics firm, said on Sunday it had paid Elon Musk’s space company in dogecoin to take a kind of mini space-exploration satellite on the mission.
The mission will be called “DOGE-1 to the Moon”. Geometric Space Corp will collaborate with SpaceX to launch a 40kg satellite on a Falcon 9 rocket in the first quarter of 2022.
Musk tweeted: “SpaceX launching satellite Doge-1 to the moon next year. Mission paid for in Doge. 1st crypto in space. 1st meme in space. To the mooooonnn!!”
The token is up more than 20,000% over the last year, according to CoinGecko, despite falling sharply at the weekend. It has been boosted by Musk and other celebrities and has captured the imagination of cryptocurrency enthusiasts.
Analysts said a key driver of the red-hot rally in recent days was Musk’s upcoming performance on “Saturday Night Live.” Many commentators said he could further drive up dogecoin by singing its praises on national TV.
Geometric did not reveal in its statement how much dogecoin it had paid SpaceX as part of the deal.
“Having officially transacted with DOGE for a deal of this magnitude, Geometric Energy Corporation and SpaceX have solidified DOGE as a unit of account for lunar business in the space sector,” Geometric Energy’s chief executive officer Samuel Reid said.
Many regulators have warned cryptocurrencies are highly risky and could plummet to zero. But many analysts have made even stronger warnings about dogecoin, saying the joke token has no use cases and is pure speculation.
