Why Dogecoin Needs to Step Out of Elon Musk’s Shadow in 2024
- The price of DOGE has decoupled from Musk’s tweets.
- DOGE’s popularity and provenance make it impossible to dismiss.
Dogecoin [DOGE] has weak fundamentals that are beginning to threaten its dominance. Over-reliance on the developments of Elon Musk, perhaps the coin’s most prominent supporter, has resulted in the coin’s vision being narrow and limited. The lack of real-world utility could be the main reason why investors do not include the coin in their portfolio.
The world of memecoins is not what it seems
Memecoins are a new bizarre class of tokens that gained incredible notoriety both within and outside of crypto circles, despite their unserious name. Gracy Chen is the CEO of cryptocurrency exchange Bitget. She describes them as possible.
“Meme coins are social tokens created by individuals for other people. Online communities and individuals who share a sense of humor or a common interest are the ones most likely to create them.” The social aspect of meme coins is an important factor in their adoption and success as it fosters community .”
Dogecoin has seen an unprecedented rise in popularity and value over the years, no longer a joke. As Warren Buffett said, “You can only tell who is naked in the water at high tide.” This sums up DOGE’s position during the crypto winter.
Shiba Inu drops “Memecoin tag”
The Shiba Inu quickly recognized the need for solid underlying technology after the bull market and all-time highs subsided. Inspired by the changes of DOGE, it began developing meaningful real-world use cases for its native tokens to shed its “meme coin” image.
Shibarium is the long-awaited Ethereum launched by Shiba Inu. After a rigorous testing period, Layer 2 (L2) chains were launched, adding a crucial feature to SHIB, Bone ShibaSwap [BONE] token. The project aims to make the ecosystem a destination for DeFi (decentralized finance) apps.
Shibariumscan reports that the number of wallets for L2 has increased to 1.35 million at the time of writing. The total number of transactions exceeded 342 million, with 526,000 processed as of February 9th.
Shibarium Scan
Shiba’s Inu strategy could change the game. Shiba Inu universe plans to expand in the long term.
Dogecoin’s over-reliance on Musk and social media
DOGE has failed to prove its real utility. Instead, they continue to rely on Elon Musk’s multi-billion dollar Platform X (formerly Twitter) and its tech czars.
Elon Musk is a keen observer of the cryptocurrency market and has occasionally praised certain aspects. But nothing comes close to his DOGE advocacy.
It all started with a pretty honest post four years ago about the dog-themed token. As they say, the rest is history.
The tech entrepreneur has since publicly supported Memecoin on several occasions. He once even called it the “people’s cryptocurrency,” citing its widespread use among his company’s workers.
In addition to the price fluctuations, the support of one of the richest people in the world led to unprecedented optimism in the Dogecoin community. The excitement reached its peak in the fall of 2022 when Musk took control of Twitter.
As soon as speculation about DOGE becoming an official crypto payment method began to rise, the price of the coin skyrocketed. Within a week, the memecoin’s value had more than doubled. At the time, it looked as if the crypto asset was on the verge of a new departure. Unfortunately rnrn, it wasn’t meant to be.
Musk’s promotion of the memecoin sent the meme world into a frenzy. It was a barrage of jokes referencing popular culture.
A meme shows Elon Musk and Doge recreating a famous scene from “Titanic” with Kate Winslet, Leonardo DiCaprio and other stars. Unlike Kate, did Doge really fly?
Has Musk’s Overconfidence Undermined Dogecoin?
It’s been almost a year. Twitter has been renamed X. The user interface received a dark makeover and Musk pushed forward with his aggressive strategies to monetize the platform. DOGE has not seen any significant developments so far. Not until the press release.
Musk hasn’t stopped talking about the coin. He recently stated that X is a DOGE-friendly place.
However, unlike previous appreciations, the reaction has gradually faded. Following the post above, the meme coin only rose 1.6% in the following 24 hours.
Gracy Chen argues that the decoupling of Musk’s contributions from DOGE prices has increased in severity during times of bearish market conditions. AskFX reported that she told AskFX.
“To achieve sustainable growth, relying on verbal support is not enough. It also depends on the current liquidity of the crypto market. More importantly, what matters is the actual developments in the ecosystem.”
Would it be fair to say that the relationship between Doge and Elon Musk will end as tragically as the Titanic?
The “Doginals Experiment”
Remember the Bitcoin transaction backlog in early May? What about the unprecedented traffic caused by the frenzy over Ordinals and BRC-20 tokens? Dogecoins were interested.
Dogecoin, in keeping with its tradition of copying Bitcoin, copied the ordinals and created their own “Doginals”, the DRC-20 standard. To create hype, the developers created a Doge Labs page on X.
Doginals have given a boost to Dogecoin’s network activity. The token, whose daily transactions were in the thousands but barely managed to exceed 100,000 in its lifetime, suddenly exploded into millions.
Source: Santiment
However, the hysteria did not last as long as with BRC-20. Doginals did not have the same impact as BRC-20 on Bitcoin’s NFT. The current situation is that the increase in transactions was an aberration and the Doginals project did not have the desired effect.
This phase was characterized by being unresponsive despite increased network activity and a lower price of DOGE. It has actually fallen over this period.
It has once again revealed a lot about the bizarre world of memecoins. In a world where the PR-heavy commentary of the tech czars is more valuable than anything tangible like network traffic.
However, industry observers believe that general crypto adoption in the future will be based on network activity. For example, Christopher Alexander, Chief Analytics Officer at Pioneer Development Group, believes that network activity will be key to mainstream cryptocurrency adoption in the future.
“Long after meme coins fade away, the utility and transactions of each chain on a blockchain will continue to increase value.” I think Elon Musk is better off thinking about the underlying blockchain technology and its incredible utility and not just through the byproduct cryptocurrency.
The launch vehicle is not yet finished, so apparently Doge fans will have to wait a little longer to say: “DOGE is going to the moon and we will not come back.” It might not be a bad idea to let the recent conquerors India or Japan around to ask for help.
Is Dogecoin’s Stagnation Cause for Concern?
Dogecoin did not experience much growth, unlike Shiba Inu.
The world’s largest memecoin is not doomed just because there has been less
Development activity of the memecoin has been on the rise. The memecoin was originally introduced to mock Bitcoin, the king cryptocurrency. Since then, it has climbed up the list of top cryptocurrencies based on market capitalization.
The Future of Dogecoin Mining
Dogecoin’s mining industry is a huge advantage. Most cryptos are adopting poof-of-stake consensus mechanisms instead of poof-of-work because the world is becoming more energy conscious.
PoW also has advantages, even if PoS is environmentally friendly. Safety is the most important thing. PoW is considered a more secure consensus method than PoS due to its strong attack resistance of 51%.
The Dogecoin mining ecosystem has grown significantly in recent years. Like Litecoin [LTC], Dogecoin mining uses the Scrypt algorithm.
Source: Coinwarz</p rnrn>
In 2018, mining memecoins gained popularity. Since then, enormous amounts of computing power have been deployed in this sector. The significant increase in the hash rate was proof of this. Dogecoin’s mining hashrate was 841.75 T/s at the time of writing.
Apart from Bitcoin, there are no other crypto assets in the top 10. DOGE’s PoW mechanism can help DOGE remain relevant in the market despite its low development activity. Since DOGE’s mining sector is not useful, the future potential growth of its mining sector remains uncertain.
AskFX reported that Ruslan Lienkha is the Chief Markets Officer at YouHodler.
“It is not clear whether the Dogecoin industry will grow in the future, as will the coin. It is not a serious investment or payment system, but a meme coin. The high volatility, frequent price manipulation, and theoretically unlimited supply will likely drive capital out of the Dogecoin industry.”
Dogecoin Wallet: [DOGE] Price Prediction for 2024-25
The Doge-Elon Musk connection said in a press release last year that the microblogging platform X does not plan to launch its token any time soon. DOGE fans were excited by this news as it increased the likelihood of X integrating Dogecoin for payments.
X also launched its official X Payments handle last month, which is similar to payments giant PayPal. This event also caused the price of DOGE to rise on the charts.
The integration of DOGE and X could fundamentally change the future of the memecoin.
The DOGE payment system is used by one of the largest social media companies. It will also change the perception of the cryptocurrency as a memecoin.
In reality, however, things are often more complicated than they seem. Since X has not confirmed whether it intends to integrate DOGE into its system, there is no way to say for sure.
Lucas Kiely, Chief Investment Officer (CIO) of digital asset platform Yield App, said it best in an interview with AskFX.
“However, despite numerous indications that Musk might allow the use of DOGE as a means of payment for his products and services, this has not yet happened. It is more than likely that he will find it difficult to convince shareholders and regulators of this to convince.
DOGE is a collector’s item
Even if Dogecoin does not perform well, it has the advantage of being based on one of the most famous memes. NFTs, on the other hand, are purely collectibles with no real purpose. DOGE can also become a valuable collector’s item over time as a reminder of the popular meme.
The coin has been one of the top cryptocurrencies based on its market capitalization for many years. It is therefore far-fetched to believe that DOGE will disappear due to its limited utility or unlimited supply.
Social media usage has increased dramatically as globalization accelerates and the Internet becomes a necessity rather than a luxury. “MEME” culture probably isn’t going away anytime soon.
Despite little to no development activity and a few unsuccessful projects, Dogecoin – the largest meme coin by market cap – still has the potential to play a significant role and become a top cryptocurrency in the coming years.
Investor interest in meme coins has increased, especially with the emergence of new coins such as PEPE and BONK.
It is therefore safe to assume that DOGE will be relevant to the next bull rally, which could take place in 2024.
It will be interesting to see how Dogecoin performs over the next few months, given the volatility of the crypto market.
