If you are accumulating Dogecoins speculating that it will reach a dollar, you should consider the factors that can prevent it from reaching such highs. The chances for Doge to hit $1 is “Rare,” and depends on various factors. It is difficult for Dogecoin to go up to $1 in the future even though it is backed by an active community and is used by thousands of Crypto users.
Table of Contents
Dogecoin Community Support
Dogecoin began as a joke currency, largely a fork of Bitcoin, and is much popular than its counterparts. Throughout its history, the coin has been hyped by different personalities giving it more exposure. On 1st April 2019, the Dogecoin community dragged Elon Musk into an April fool’s joke in which he became the CEO of Dogecoin. Right after, he positively tweeted about it, and the Dogecoin price went to the moon.
Even though Dogecoin has lost those gains, the hype by Elon Musk gave the coin extra visibility. Dogecoin has also been endorsed by Jon McAfee, a member of the cryptocurrency community best known for his $1,000,000 Bitcoin price prediction. On his Twitter account, McAfee said that he has high hopes from the digital currency which goes in line with the Dogecoin price predictions by other market experts.
Factors Preventing Dogecoin to Reach $1
There is no denial of the fact that Dogecoin has a lot of support from several Crypto veterans and active adoption. Many web and mobile apps are integrating the currency into their platform, but this doesn’t mean that it will be worth a dollar, and there are various reasons for this.
Doge lacks a core development team, and all its developers contribute to the project part-time. It has no technical updates for more than four years. Besides, its founder Jackson Palmer abandon the project in 2015, stating that Dogecoin’s community is toxic and is only concerned with pumping its price. He further asked the community to remember the coin’s playful and fun roots, instead of using it as a gamble to get rich.
Additionally, Dogecoin has no maximum supply, and the currency is inflationary, unlike other assets like Litecoin. While there are many other Altcoins, following an inflationary protocol, only a few have a massive circulating supply like Doge, which is over 100 billion. In other words, there is a lot of Dogecoin in the market, which prevents it from reaching new highs.
Dogecoin Started as Joke Currency
On a serious note, this coin started as a joke. The coin founder, Billy Markus, created it for fun. There was not a central idea or a solid team behind the project. The developer had his inspiration from an internet meme and wanted to create a coin out of it. Upon its release, speculation and strong support from the community drove the price. The project didn’t have any use case in the beginning, and there was not a whitepaper either. The developer introduced the currency with no solid backing from venture capitalists to increase its influence in the Crypto market.
Dogecoin to $1 will make it more Valuable than Bitcoin
Supply is one of the significant factors for the determination of Cryptocurrency prices. Mainly Cryptocurrencies are deflationary; this means that their supply reduces over time until all the coins in the protocol are mined. In comparison, Dogecoin is an inflationary cryptocurrency. Although Dogecoin’s inflation in terms of percentage decreases, this still doesn’t give the coin a green signal to reach $1. Hence, any increase in price fueled by demand is likely to meet with the increasing supply.
In other words, when there is no maximum cap on the supply of any coin, it will deter the price from reaching new highs. For example, at the time of writing this post, the circulating supply of Dogecoin is 118,001,264,037. If somehow, one Dogecoin was worth a dollar, this would mean market capitalization of $118,001,264,037 for Dogecoin. That is almost twice of current Bitcoin market cap, and reaching such a position would be mind-boggling.
Already among top 50 Crypto Currencies
Dogecoin is already among the top 50 Crypto Currencies. This makes it harder for Dogecoin to compete with its competitors and surpass them in market capitalization. Just for thought, ever wonder what it would like to have Dogecoin dethroning Tron or other valuable Cryptocurrencies project?
This is not something impossible but needs significant efforts, development, and hard work. In years to come, Dogecoin is likely to struggle for its dominance among the top 50 cryptocurrencies as the Cryptocurrency ecosystem evolves into a better and project-driven market.
So, will Dogecoin reach $1?
Much is possible in Cryptocurrencies. Speculation, hype, and affiliation to third parties can impact a coin’s price. We all know how the market performed during the earlier bull run, leading Altcoin prices to reach new highs. But this doesn’t give space to abnormal fluctuations in the market. In conclusion, together with a lack of development and supply numbering billions, it is difficult for Dogecoin to reach $1.
Disclaimer: This is just an opinion and should not affect the user’s decision.