Why Dogecoin Is No Longer a Joke
How the meme-inspired cryptocurrency became an Elon Musk obsession
Forget the Year of the Ox — 2021 is rapidly shaping up to be the Year of the Doge, a cryptocurrency based on the internet meme of a Shiba Inu dog with a less than stellar command of English, hence “doge” and not “dog.” Nowhere has this development been cheered on more than on Elon Musk’s Twitter feed.
On February 7, the Tesla CEO — and arguably the world’s most powerful influencer — tweeted, “Who let the doge out?” Later that same day he followed with, “No highs, no lows, only Doge.” On February 21, he cryptically tweeted “Dojo 4 Doge.”
The cryptocurrency market has been quick to react to the flurry of Musk’s Dogecoin-related tweets: On February 8, Dogecoin rallied 37% within a 24-hour span to a record high of 8.5 cents. As Matt Levine, author of Bloomberg’s “Money Talks” column recently mused, “the way finance works now is that things are valuable not based on their cash flows but on their proximity to Elon Musk.”
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Owing to its meme-inspired mascot, Dogecoin is usually considered a joke currency. But its current market cap of $6.4 billion is twice that of AMC Entertainment, another company that got caught up in the recent meme-stock mania.
In the first week of February, Musk tweeted an informal poll in which his followers selected Dogecoin as the currency of the future. It is impossible to tell how sincere Musk is in his Dogecoin advocacy. Tesla, after all, earlier this year invested $1.5 billion in bitcoin, not Dogecoin. And the company said it will soon accept bitcoin, not Dogecoin, as payment for its products.
But in light of Dogecoin’s recent resurgence and growing relevance in the cryptocurrency markets, here’s a primer to understand the cultural and economic significance of the internet-friendly, meme-inspired altcoin that first emerged as a joke back in 2013.