Dogecoin (DOGE-USD) is up nearly 6% for the week ending April 8. And at one point it was up 28%. The reason for this recent spike is attributed to Dogecoin ambassador Elon Musk’s purchase of an ownership stake in Twitter (NYSE:TWTR). The speculation (and that’s a key word) is that Musk may use his influence to have DOGE-USD accepted as a form of payment on the platform.
This illustrates what has always been true of Dogecoin. It’s a clear example of the influence that community has in “tokenomics.” Simply put, Dogecoin is famous for being famous.
What does this have to do with Charles Schultz? One of Schultz’s famous characters is Lucy Van Pelt, the sister of Charlie Brown’s blanket-carrying friend Linus. In one legendary scene from A Charlie Brown Christmas, Lucy was questioning the greatness of Beethoven. She exclaimed, “What’s so great about Beethoven? … He never got his picture on a bubble gum card. …How can you say someone is great who’s never had his picture on a bubble gum card?”
Dogecoin enthusiasts have the bubble gum card factor going for it. Dogecoin is a legitimate peer-to-peer payment network for those that wish to use it. But it has struggled to develop more utility outside of that. What it does have, however, is the backing of famous people like Musk and Mark Cuban. Let other cryptos talk about their fancy oracles and shards, Dogecoin can be used at the Dallas Mavericks Merchandise Shop. Wow.
Many investors have made a lot of money because they bought DOGE-USD at the right time. However, there are many investors who bought near the peak and are hoping that Dogecoin can reclaim its former glory. In this case, they may draw some inspiration from Lucy’s brother Linus who is still waiting for the Great Pumpkin to rise from the pumpkin patch. Who’s to say it can’t happen? Fame can have its privileges. I’m just not sure it’s the soundest strategy, even for crypto investing.
On the date of publication, Chris Markoch did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
