The results of the just-ended U.S. presidential elections have contributed to Dogecoin’s notable increase over the past week. In the past seven days, the most popular memecoin has soared by more than 120%, inspiring hope and confidence for an even higher trajectory toward its all-time high of $0.7.
The increase in DOGE’s value, however, is not unique. This development was advantageous to the entire cryptocurrency market. For the first time since cryptocurrencies became widely used, the market’s overall capitalization topped $3 trillion earlier today.
Although investors are thrilled with DOGE’s price increase, some are worried about whether it will be able to draw in institutional investors. Dogecoin has no practical use and is only a speculative asset. Like other memecoins, it started as a joke but managed to win over investors and become one of the biggest cryptocurrencies in terms of market capitalization.
The head of Auros Ventures, Julien Auchecorne, stated in a statement that the current market surge seems durable because the future government administration would be very supportive of the cryptocurrency sector.
Elon Musk Behind DOGE Rally?
Elon Musk, the CEO of X and Tesla, has a reputation for being a fervent advocate of cryptocurrencies, especially Dogecoin. Any remarks he makes that are connected to DOGE, whether directly or indirectly, cause a big spike.
Before the election, Musk suggested creating a “Department of Government Efficiency” (D.O.G.E.) in the event that Trump appoints him to his administration. Musk revealed that the plan aims to reduce the government budget by at least $2 trillion.
The adoption of D.O.G.E., an acronym that closely resembles DOGE, caused a flurry in the Dogecoin market and sparked a positive momentum that would propel the coin’s price to unprecedented heights.
“Altcoin launch structure is under pressure, especially as institutional incentives still heavily favor de-risking at launch and redirecting capital afterward,” Musk stated in a statement. He went on to say that protocols are currently modifying their tactics to keep institutions involved after launch.
Dogecoin Attracts Institutional Investment
Meanwhile, a well-known blockchain company has taken notice of Dogecoin. A Canadian firm, Spirit Blockchain Capital has revealed its intentions to buy Doegcoin massively, copying Microstrategy’s approach to buying Bitcoin.
Through the introduction of exchange-traded products (ETPs) and payment gateways, Spirit hopes to institutionalize Dogecoin’s use case beyond its meme origins.
The price increase of Dogecoin has been influenced by each of these elements. On-chain data indicates that Dogecoin (DOGE) is currently trading at $0.3717, up 28.02% over the previous day. Additionally, its one-day trading volume has increased to $37.6 billion, a 103% increase.
Conclusion
Dogecoin’s recent surge highlights the power of market sentiment, speculative interest, and influential figures like Elon Musk in driving the memecoin’s value. Musk’s light-hearted proposal for a “Department of Government Efficiency” (D.O.G.E.) seems to have spurred enthusiasm, bolstering Dogecoin’s relevance in the eyes of retail and even some institutional investors.
Spirit Blockchain Capital’s interest in large-scale Dogecoin purchases reflects a trend of institutional players cautiously exploring non-traditional crypto assets, despite Dogecoin’s lack of inherent utility. While speculative, this movement demonstrates that Dogecoin’s meme origins are no longer a deterrent to adoption, with investors seeing potential in its popularity-driven value.
Anthony Pedro
Anthony Pedro is a seasoned crypto writer with a deep passion for blockchain technology and digital currencies. With over 4 years of experience in the cryptocurrency space, Anthony has become a trusted voice, offering insightful analysis and commentary on the latest trends, innovations, and market movements. When not writing, he is actively engaged in the crypto community, attending conferences, advising blockchain startups, and experimenting with new projects.