As impressive as the rise of Dogecoin was, so brutal is the crash: 76% DOGE is currently below the all-time high, thousands of retail investors are facing losses. Tesla CEO Elon Musk, so far the most prominent DOGE-pumper, is silent on the recent price declines. Sam Bankman-Fried, on the other hand, CEO of the crypto exchange FTX, says: Dogecoin is the asset of the year-the asset we earned.
The ” Dogecoin financial standard“
Dogecoin’s success story, it was almost too good to be true. On January 1, the DOGE rate was still at $ 0.0056. Then Elon Musk expressed himself unequivocally several times on Twitter-ambiguously positive about the meme currency-and the rest is crypto history: to almost 1 dollar, DOGE rose within the next few months, on May 8, the coin reached an all – time high in the amount of 0,73 dollars. DOGE, ironically the underdog among the well-known cryptocurrencies to date, had completely left the rest of the market behind in terms of performance.
For Sam Bankman-Fried (called SBF), the 29-year-old billionaire and CEO of the crypto exchange FTX, Dogecoin is the asset of the year – but not just because of the price action. SBF considers the Scherz currency to be a reflection of the current economic climate. Bankman-Fried (by the way, also the second largest donor to the election campaign of Joe Biden):
“If there is such a thing as an asset of the year for 2020 and 2021, then it would be Dogecoin. This is the asset that accurately reflects our current economic climate. This is the asset that we have all chosen and that we have earned in both good and bad times.“
This is not an endorsement, the billionaire said, nor is it an anti-endorsement. He did not want to take a position, but:
“I’m just saying that everything we decided as a society last year brings us closer and closer to the Dogecoin financial standard.“
But how could it happen that a Scherz currency temporarily has a larger market capitalization than car manufacturer BMW? According to SBF, some factors would have ensured this – and Elon Musk. Bankman-Fried, who has a net worth of $ 8.7 billion as of March:
“He’s really powerful. He’s the most influential man in the world when it comes to financials, right now. His tweets move the markets. He chose Dogecoin, and no one was surprised.“
Everyone had “somehow known”, according to SBF, that Musk would opt for Dogecoin (to buy from eToro or Libertex).
“And we chose Elon. We chose this.“
Millions of bored people at the computers
SBF also sees the success of social media as a cause for DOGE’s brilliant rise. Suddenly, millions of people around the world would be able to communicate and vote on Twitter. With corresponding consequences:
“If you take these 10 million people together, and even if each of them has only $ 1,000, that’s $ 10 billion in inflows, and that competes with the inflows you get from the biggest institutions in the world.“
So you suddenly have this global decentralized network of bored people at home on their computers, who together form the largest pension fund, the largest investment fund, the largest ETF (listed fund) in the world – but they do not have a fiduciary duty to shareholders, but a completely different background. SBF:
“You can buy whatever you want, and if you want to buy a Dogecoin, then you will buy a DOGE.“
Nevertheless, it seems that the last DOGE chapter has not yet been written. Fact is: Elon Musk is working with the Dogecoin developers to improve the coin. Should there be useful results here, this could also have a correspondingly positive effect on the DOGE course.