In the past few weeks, it has been difficult to go through a day without coming across a headline or 50 referring to Dogecoin (DOGE). The Meme Cryptocurrency has seen an exponential price increase after a number of celebrities including billionaire Mark Cuban, Kiss member Gene Simmons and entertainment icon Snoop Dogg.
It's easy to discard what's going on with DOGE in yet another round of hype madness – like the ones previously seen – especially with Elon Musk workshopping ideas from "The Dogefather" ahead of his Saturday Night Live hosting gig on Aug. May.
This time around, however, something happens that has never been seen before: the use of Dogecoin for payments has increased along with the price of the coin. In addition to the National Basketball Association's Dallas Mavericks, a team led by Dogecoin advocate Mark Cuban, the Major League baseball franchises are now also participating in the DOGE game. But is the growth in DOGE payments sustainable outside of the hype cycles?
Very sympathetic medium of exchange
Money can be a tool for coordinating human activities. To play this role, the asset used as a medium of exchange must evoke the positive mood of a sufficiently large audience. This positive attitude can stem from a long-established convention (as in the case of Fiat), technological solidity (like a token to facilitate monetary transactions on a blockchain), or simply the fact that people like it or think it's just weird.
Dogecoin lacks technological robustness; No significant software update has been carried out for many years. Until recently, the practical use of the asset was mainly limited to notifying people of funny comments in forums.
However, it's not inconceivable that the combination of Dogecoin & # 39; s memetic power – as it has shown on numerous occasions in the past – and the fading lines between collective sentiment and collective action could mean more for adoption as a means of payment than for solid reputation or technological superiority.
Granted, the main motivation for companies to accept DOGE payments at this point is likely the ticket to the hype train that such a move entails. In addition to viral fame, a brand can benefit from the support of a lively Dogecoin crowd keen to empower companies that sell their bags on social media – a relationship some watchers call "mutually parasitic". However, it is unclear what will happen when a critical mass of businesses choose this path.
Very zoomer money?
Analysts often cite Dogecoin 's popularity among younger internet users as a rocket fuel that can eventually make it to all sorts of incredible places. In a recent interview, Ran Neuner, co-founder and CEO of blockchain investment firm Onchain Capital, suggested that young TikTok users could generate sufficient network effects to make DOGE a viable tool for online transactions.
It's hard to gauge how popular Dogecoin is with teenagers and young adults. In fact, it's a compelling idea that the coin, which started out as a hoax and now has a market cap of $ 77 billion, embodies the nihilistic spirit of the younger generation. It is also true that the price pump started on TikTok last summer.
However, when it comes to how many Generation Z Zoomer members are using DOGE, the most honest answer is that there is no way you can know. Reliable survey data on crypto usage is difficult to come by, which is doubly true for age group-specific data. According to the latest iteration of the Teen Inventory Survey by investment bank Piper Sandler, 9% of teenagers in the US said they had traded cryptocurrencies. While the nearly one in ten statistic looks solid, it doesn't give any details about what assets respondents traded.
Another recent survey by financial group Charles Schwab looked at cryptocurrency trading behavior among young adults in the UK. It found that more than half of UK investors between the ages of 18 and 37 traded or owned cryptocurrencies, compared to 25% of those who bought stocks. Again, there are no details about the use of certain coins or the percentage of respondents who said they were active on TikTok.
In a subsequent conversation with Cointelegraph, Neuner compared Dogecoin to a rebellion movement: "Dogecoin has become an anti-establishment, an anti-normal" and added:
"People who don't like to stick to the rules turn to Dogecoin to show that they can make anything work, even against the odds. I've said this many times: I think it's always about 20% Technology, 80% about acceptance, and in this case Doge is actually adopted. "
So great attraction
While it remains an open question whether a single age or interest group can propel an asset to the coveted status of popular payment method, Dogecoin may appeal to a wide range of users. In addition to the nihilistic youth and meme-loving day traders, it could be an easy and friendly introduction to digital assets beginners.
Without claiming to be a technologically complex asset, the puppy-adorned coin is well positioned to become the first ever crypto for the less tech-savvy newbies who are arriving in droves as crypto becomes more mainstream.
Additionally, the atmosphere of frivolity could attract people nostalgic for the time before Bitcoin (BTC) derivatives were traded on major institutional platforms. Dogecoin could be the last bastion of the old crypto ghost that traditional financial sharks want to deal with – hence the folk coin?
As expected, many crypto experts have none of this. When asked if Dogecoin has a future as a medium of exchange, Joshua Frank, CEO of cryptocurrency data analytics company The TIE, responded on Cointelegraph:
"No. It's a fun meme and it has received tremendous mainstream attention, but I don't see a future where Doge is the coin of the internet."
However, with the right combination of social sentiment, well-timed celebrity tweets, and forays into engagement-seeking big brands, it doesn't seem impossible for DOGE to gain mass popularity as a payment tool in a sizable corner of the online economy.
However, price speculation will continue to be a big problem as whales or influencers can easily influence the coin until a sufficient network effect is achieved.