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If you own Elon Musk’s favorite cryptocurrency, Dogecoin, how much will it be worth in 5 years?
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Elon Musk was professing his love for Dogecoin for a few years now — his first post about it dates back to 2019, when he called it his “favorite cryptocurrency” — and since then it has been sending the cryptocurrency on a roller coaster ride following each of his multiple posts about it. And earlier this month, in a significant move and an additional stamp of approval for cryptocurrency, Tesla updated its payment methods to accept DOGE, according to its website.
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This sent DOGE’s price soaring, according to CoinGecko. And as of May 10, the price was up 3.5% over the past week and a whopping 94.1% over the past year, according to data from CoinGecko.
However, DOGE’s trajectory is complicated, as many alternative cryptocurrencies and memecoins are inherently extremely volatile. And while Musk continues to have a significant impact on DOGE’s popularity and price, it remains to be seen whether his path is tied to him.
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It is difficult to predict how much the DOGE will be worth in five years
Patrick Gruhn – lawyer, entrepreneur, CEO of PMX Technologies and former (now deceased) FTX executive – argued that there is no way to truly predict how much DOGE will be worth years from now, especially with “the absolute hype around memecoins even on Solana” .
However, Gruhn noted that there is a very interesting point about memecoins in general, as they are often seen as a form of protest.
“The argument goes like this: ‘If the government is going to inflate and tax my hard-earned money to pay off its debts, enrich its friends, and buy political votes for re-election, then I will simply use a completely different method – a monetary system that they can’t mint. And it’s going to be a dog on the face of the coin, because that’s what I think of what is currently represented by the faces currently on our physical coins,'” he said.
“Seeing as Elon is creating an entire ecosystem of software and hardware innovation, perhaps he could support this protest and allow Dogecoin to be used with his products/services, thus ensuring demand for it. So, obviously, the five-year value can be substantial,” he added.
Other experts intervene
And while other experts agree with the premise that it is difficult to predict the price of memecoins due to their volatility, one thing is for sure.
“Memecoins are here to stay, at least for now,” said Jeff Owens, co-founder of Paradise1.
Owens noted that despite the lack of underlying technology or tangible use case, the memecoin frenzy in recent months highlights that these assets have some value, value that largely depends on market sentiment.
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Additionally, the institutional adoption of memecoins and their entry into the broader financial landscape, like Tesla’s move, will further increase the hype, he said.
However, he also stressed that these early steps of adoption have not prevented memecoin volatility.
“By nature, they are a much more volatile investment than other major cryptocurrencies like Bitcoin or Ether,” he said. “So this is something to keep in mind when investing in Dogecoin, or any other meme-themed coin, over the next five years.”
Tayler McCracken, editor-in-chief of Coin Officesaid DOGE faces significant competition in the memecoin space as well, with tokens like Pepe, Shiba Inu, Bonk and countless others gaining market share.
Memecoin investors, he said, are rushing to catch the latest trends in search of the “next DOGE,” which could further dampen Dogecoin’s performance.
What about Musk’s continued impact on Doge? Is the Doge’s trajectory linked to Musk?
Like Rebecca Liao, CEO of Saga, noted, “Attention is an incredible asset in the digital economy the world increasingly operates in.”
“We are still in the early stages of this trend and most memecoins, I should caution, will never be worth much in the long term,” he said. “But for keeping digital communities together, memecoins have a lot of attraction and impact. The fact that many of them are so fun and silly only adds to this attraction, as Elon Musk has clearly demonstrated with his affinity for Dogecoin.”
As for Musk’s continued impact on cryptocurrencies, Coin Bureau’s McCracken called it “the elephant in the room.”
According to him, although many consider Elon the de facto spokesperson of the Doge, there is a risk that he will get bored of the currency and move on to something else.
“There is significant ‘key man risk’ when the price of a cryptocurrency is heavily influenced by the adoption and motivations of a single individual,” he said.
He noted that when Musk was asked why he loves DOGE so much, he pointed to the humor in the irony of it.
“Elon is uniquely positioned to integrate Doge into multiple different aspects of the company as a payment method,” he added. “Depending on Elon’s actions and vision for things like sending Doge to the moon (literally) and accepting Doge products for Tesla, with Elon’s backing, Dogecoin price is likely to remain relevant and with strong performance in the industry of cryptocurrencies.”
McCracken added that even if Musk were removed from this situation, DOGE would likely still remain relevant, albeit at a slower pace.
“It has become a truly world-class bastion for the memecoin community and since Memecoin is among the best performing projects of all time, even without Elon’s promotion, Dogecoin will likely continue its long-term potential,” he added.
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This article originally appeared on GOBankingRates.com: If you own Elon Musk’s favorite cryptocurrency, Dogecoin, how much will it be worth in 5 years?