Dogecoin’s record-breaking rise shoots ‘joke’ cryptocurrency to wider attention. Analysts say Elon Musk’s turn as host of Saturday Night Live will raise its profile yet further. It is perhaps the ultimate symbol of late capitalism: a digital currency that started as a joke, now worth more than the Ford motor company, BP or Tesco.
Riding a wave of speculative interest despite Covid-19 triggering the worst global recession since the 1930’s Great Depression, Dogecoin has been a huge hit with amateur investors. It is a cryptocurrency based on an internet meme – a humorous online phrase or photo, which on this occasion is a dog – and has shot to wider attention with a record-breaking rise in value in recent weeks.
Backed by famous supporters including the Tesla founder, Elon Musk, the rapper Snoop Dogg and the Kiss bassist Gene Simmons, the digital asset similar to bitcoin jumped by more than 40% on Wednesday to reach $0.68 (£0.49) against the dollar, according to CoinMarketCap.
With a surge of more than 14,000% since the start of the year, Dogecoin’s market capitalisation – the combined value of every coin – has now hit more than $84bn, equivalent to the annual economic output of Sri Lanka.
Analysts said the rising price of the digital currency, which is similar to bitcoin, comes amid interest ahead of Musk hosting Saturday Night Live this weekend, given the billionaire’s public support on Twitter for Dogecoin and the potential that him appearing on the popular US TV show will raise its profile further.
“Dogecoin is surging because many cryptocurrency traders do not want to miss out on any buzz that stems from Elon Musk’s hosting of Saturday Night Live.” said Edward Moya, senior market analyst at the financial trading platform Oanda. “Also known as the Dogefather, Musk will undoubtedly have a sketch on cryptocurrencies that will probably go viral for days and further motivate his army of followers to try to send Dogecoin to the moon,” he said. Musk already has form as a crypto maverick, buying $1.5bn of bitcoin with cash reserves at Tesla. He has previously tweeted support for Dogecoin in what may be best understood as the perpetuation of an online joke. Having often courted controversy on Twitter for offbeat comments, costing him and his company millions of dollars and landing him in legal trouble, Musk helped raise Dogecoin’s profile in February by posting a picture of Doge on the moon, planting a flag bearing the digital currency’s logo, and captioned with one word: “literally”.
The tweet pushed up the value of the digital currency by more than 20% on the day. The phrase “to the moon” is used online to talk up investments, indicating the direction of travel for a financial asset, and was used prominently by Reddit users on the WallStreetBets forum earlier this year as small investors boosted shares in GameStop in an attempt to undermine hedge funds. Created in 2013 by two software engineers from IBM and Adobe, the Dogecoin digital currency is based on the Doge meme, which features a Japanese shiba inu dog surrounded by grammatically incorrect phrases in a kind of inner monologue.