Dogecoin spikes 400% in a week, stoking fears of a cryptocurrency bubble

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Dogecoin started out as a joke. Now it’s a top 10 digital currency worth $40 billion.

The cryptocurrency is based on the “Doge” meme, which rose to popularity in late 2013. The meme portrays a Shiba Inu dog alongside nonsensical phrases in multicolored, Comic Sans-font text.

Created in 2013 by software engineers Billy Markus and Jackson Palmer, dogecoin was intended to be used as a faster but “fun” alternative to bitcoin. It has since found a growing community online.

And now, defying all odds, dogecoin has a total market value of more than $40 billion, according to crypto market data site CoinGecko, adding over $20 billion in the last 24 hours. The digital token reached an all-time high of 32 cents Friday morning, more than doubling in price from a day ago.

‘I just became a Dogecoin millionaire’

Dogecoin has been climbing again in the past week, hitting 10 cents a coin for the first time on Wednesday. It’s risen by a whopping 400% in the last seven days.

On Friday, a Reddit user posted a picture of their dogecoin holdings on the Robinhood investing app.

“Hey guys I just became a Dogecoin millionaire,” the user said, showing a balance of $1,081,441.29 in their account.

Why is dogecoin rallying?

Dogecoin has attracted a following among users of Robinhood. On Thursday, the U.S. online brokerage said there was a “major outage” in its crypto trading feature after facing “unprecedented demand.” The feature is now back online, Robinhood said.

Some reports have attributed the latest dogecoin rally to support for the meme-based token from Tesla CEO Elon Musk. He has made several tweets about dogecoin, which in turn has helped push up its price.

On Thursday, Musk posted a cryptic tweet saying “Doge Barking at the Moon,” likely in reference to the popular crypto slang phrase “to the moon.”

The billionaire has called dogecoin his “fav” cryptocurrency and “the people’s crypto.” Musk has also come out as a supporter of bitcoin, with his electric car company buying $1.5 billion worth of the cryptocurrency earlier this year.

But his tweets have worried some investors, given their apparent ability to move markets. Some bitcoin investors, for instance, have sounded the alarm about Musk’s dogecoin tweets. Nic Carter, co-founder of Castle Island Ventures, warned retail investors “are going to lose money on dogecoin,” calling it a “vehicle for speculation.”

Bubble concerns



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