- Robinhood lowered its minimum Dogecoin order size to one from 10 on Tuesday, hailed as “Doge Day.”
- The brokerage also said it would allow investors to buy smaller amounts of bitcoin and ether.
- Dogecoin, based on a meme and created as a joke in 2013, has limited utility.
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Robinhood said on Tuesday that it would lower its minimum Dogecoin order size to one coin from 10 coins as the meme-based asset’s popularity rises rapidly.
“Much happy! Very day! We’ve lowered the minimum order size from 10 $DOGE to 1 $DOGE. You can now build up your doge empire one coin at a time,” Robinhood said in a tweet. “We’ve also lowered the minimum order size for $BTC (0.000001) and $ETH (0.0001) so it’s easier for anybody to invest in crypto.”
Bitcoin’s previous minimum order on the brokerage was 0.0001, while ether’s old minimum was 0.001.
The trading app describes Dogecoin as a “playful take” on cryptocurrencies. “It’s typically used in online communities to ‘tip’ users for content that’s particularly witty or useful. It’s also become a popular cryptocurrency for donating to charities,” Robinhood says of the meme currency.
The digital asset recently hit a peak of $0.41, taking its year-to-date gains to more than 8,700%. But it was trading 21% lower, at $0.30, on Wednesday.
After Dogecoin hit its all-time high, Robinhood experienced a major trading outage that made it impossible for investors to join the rally. That instance mirrored GameStop’s rise in January, when traders were unable to get in on its booming stock as demand skyrocketed.
“Robinhood is a repeat offender here,” said Richard Smith, CEO of the Foundation for the Study of Cycles. “They are trying to be all things to all people. They are like Uber in the early days where their attitude is, ‘Who cares if we break a few things as long as we keep growing engagement.'”
Smith added: “Breaking a few things in the taxi business is one thing. Breaking a few things in the highly regulated retail financial services industry is something else.”
Robinhood said that the interruptions to trading were unacceptable but that heightened interest in crypto could continue to cause service interruptions.
Dogecoin was created as a joke in 2013, based on a meme.
“Whilst it has some limited practicality as a way of micro-tipping posters on internet forums, its rise has probably very much due to personal amusement reasons in the internet meme culture, recently spurred on by a playful Elon Musk on Twitter,” said Alex Joshi, a behavioral-finance specialist at Barclays Private Bank.
Joshi said that when the price of an asset rises so spectacularly in a short period, investors get lured in with the prospect of getting rich quick. “When you add in rapidly growing numbers of people buying because they see everyone else buying and making extraordinary returns, speculative herding behaviour really takes off, leading to vast numbers entering the market at extremely high price levels,” he said.