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Dogecoin Remains a Joke of a Cryptocurrency

The cryptocurrency that was started as a joke rose 30% recently on news that Elon Musk is buying Twitter

By Joel Baglole, InvestorPlace Contributor Apr 29, 2022, 7:45 pm EST
  • Dogecoin (DOGE) got a brief bounce higher on news that Elon Musk is buying Twitter (NYSE:TWTR).
  • The original meme coin still remains a joke of a cryptocurrency and serves no purpose.
  • Beyond news that Elon Musk is buying Twitter, there has been no substantial developments that would move the price of DOGE.
One Golden Dogecoin Coin on keyboard, Meme coins
Source: Zarko Prusac / Shutterstock.com

Elon Musk’s $44 billion purchase of social media company Twitter (NYSE:TWTR) has shone a new light on cryptocurrency Dogecoin (DOGE-USD).

The original meme coin has been in a downward spiral over the past six months and has performed worse than most digital coins and tokens in that period. Currently trading at just $0.14, DOGE is down 52% in the last six months, including a 21% pullback this year.

It’s a far cry from May of last year when Dogecoin was trading at a then all-time high of $0.68 per token and crypto bulls were actively trying to push the price to $1. However, the coin that was started as a joke continues to be closely associated with Elon Musk and got a bounce recently when the Tesla (NASDAQ:TSLA) chief executive officer (CEO) secured the purchase of Twitter (NYSE:TWTR).

DOGE Dogecoin $0.13

Twitter Bounce

Dogecoin, which features an image of a Shiba Inu dog and has frequently been touted by Elon Musk in tweets, jumped 30% higher after the world’s richest person convinced Twitter’s board of directors to let him buy the social media giant and take it private. Immediately after news of the Twitter deal was announced on April 25, the price of DOGE jumped to $0.17. This increase occurred while other cryptocurrencies such as Bitcoin (BTC-USD) and Ethereum (ETH-USD) saw their prices fall.

It’s not clear exactly why Musk buying Twitter ignited a price rise in Dogecoin. Some analysts have speculated that the cryptocurrency’s price increased on expectations that Musk will use the Twitter platform to promote DOGE and other digital assets, and try to increase their mainstream acceptance.

Whatever the reason, the bounce higher in Dogecoin’s price was short lived and the cryptocurrency quickly fell back to earth to trade at its current level of $0.14.

In Other News…

Beyond Musk buying Twitter, there hasn’t been a lot of recent news that would act as a catalyst to propel the price of DOGE higher. Jamestown, a real estate company with national reach in the U.S., recently announced that it will accept payment in Dogecoin through BitPay integration.

The digital token also experienced a brief move higher after Fidelity announced that it will allow its customers to hold Bitcoin and other cryptocurrencies in their 401(k) retirement accounts. But beyond that, there’s been no substantial news related to Dogecoin.

Electric vehicle maker Tesla, which Musk still runs as his day job, is one of the biggest corporate buyers in the world of Bitcoin. Many retail investors hope to see Twitter adopt more cryptocurrency features once Musk is firmly in control of the social media company, something that could help cryptocurrencies gain greater acceptance. Dogecoin was started in 2013 merely as a joke by a couple of programmers, but has managed to hang around despite having no underlying utility.

Don’t Be Fooled By DOGE

Despite the recent, albeit short-lived, move higher in the price of Dogecoin, the digital coin remains a poor investment. People should not be fooled by any rise in Dogecoin. The meme coin remains one of the worst cryptocurrency investments.

Not only does Dogecoin serve no purpose, it remains a complete joke, as was intended. Investors who are serious about adding crypto exposure to their portfolio would be better served buying a more legitimate digital asset such as BTC or ETH. Twitter or no Twitter, DOGE is not a buy. #badmove.

On the date of publication, Joel Baglole 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.

Article printed from InvestorPlace Media, https://investorplace.com/2022/04/dogecoin-remains-a-joke-of-a-cryptocurrency/.

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