Dogecoin Price: Could it Go up 100% Again?

Even though it started out as a joke, Dogecoin has gotten more limelight in 2021 than most other senior cryptocurrencies, and this speculative attention might boost it again.

| More on:
Question marks in a pile

Image source: Getty Images

You’re reading a free article with opinions that may differ from The Motley Fool’s premium investing services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn more

May 2021 hasn’t been good for cryptocurrencies. Bitcoin, the premier cryptocurrency and the forerunner of the crypto investing trend, is down 27% from its recent peak. Speculators and market experts are pointing to several factors, but the two most prominent ones would be Elon Musk and China.

Elon Musk said he was worried about Bitcoin’s impact on the environment, which is an argument most people against Bitcoin use quite frequently. He also made an ambiguous statement about Tesla’s Bitcoin holdings (which he later corrected). China, however, has been cracking down hard on Bitcoin transactions.

The combination of these two factors pushed Bitcoin off the cliff. But if Elon’s influence over the crypto community allows him to facilitate the downfall of the world’s most famous crypto, can he leverage his influence to push the Dogecoin price to the moon?

Dogecoin’s chances of going double

Dogecoin has been around since 2013. It officially started out as a joke but got a lot of attention right from the beginning, partially due to the meme community and partially because it had a different proof of transaction method than Bitcoin. It has two now well-known founders, but somehow, Elon Musk took it upon himself to make this joke crypto famous, and he declared himself the Dogefather.

His “efforts” and a trend to push the value of Dogecoin to US$1 (started on TikTok) caused this particular crypto to grow at an impressive pace. It peaked in May, and the value reached US$0.7, but it has come down substantially from that peak.

It might be the general “declining” aura of the crypto market, or Dogecoin might be going down for good. Still, if Elon or some other factor causes the price to spike again and it actually reaches its US$1 price point, it will go up more than 100% from its current valuation.

Buy low

If you want to get into the action of Bitcoin, Dogecoin, or any other cryptocurrency, but you don’t want to complicate your taxation by handling the crypto directly or can’t cross the price barrier, an indirect way to gain exposure would be through a Bitcoin-related stock like HIVE Blockchain Technologies (TSXV:HIVE). The stock has come down 54% from its yearly peak, and with the direction in which Bitcoin is going, the stock might have yet to reach its full “depth” potential.

If you believe that Bitcoin will make a recovery and the current dip is just one of the cycles the currency goes through, then you might consider buying HIVE when it reaches rock bottom — i.e., somewhere around the time Bitcoin starts spiking again. The stock magnified the gains a Bitcoin investor would have gotten by investing in the crypto directly, and it might be able to repeat the feat.

Foolish takeaway

Cryptocurrencies have the potential to make you rich fast, and most such assets and investment opportunities carry a higher-than-normal risk. If you have the risk appetite for it and dispensable cash, Dogecoin might be a powerful investment, especially when it reaches rock bottom. But instead of focusing solely on Doge, it might be advisable to diversify your crypto investments a bit.

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium service or advisor. We’re Motley! Questioning an investing thesis — even one of our own — helps us all think critically about investing and make decisions that help us become smarter, happier, and richer, so we sometimes publish articles that may not be in line with recommendations, rankings or other content.

Fool contributor Adam Othman has no position in any of the stocks mentioned. David Gardner owns shares of Tesla. Tom Gardner owns shares of Tesla. The Motley Fool owns shares of and recommends Tesla.

More on Tech Stocks

Growth from coins
Tech Stocks

Got $1,000? Buy These 3 Under-$20 Growth Stocks to Earn Higher Returns

These under-$20 growth stocks can deliver solid returns in the long run.

Read more »

Shopping card with boxes labelled REITs, ETFs, Bonds, Stocks
Tech Stocks

TFSA Investors: 3 TSX Stocks You’ll Regret Not Buying on the Dip

Among wide range of investments allowed in a TFSA, now is the time to invest in stocks.

Read more »

Tired or stressed businessman sitting on the walkway in panic digital stock market financial background
Tech Stocks

2 Stocks That Lost Over 50% in 2022

The recovery of the TSX’s tech superstar and a promising high-growth stock that lost more than 50% in 2022 is…

Read more »

Man holding magnifying glass over a document
Tech Stocks

Why BlackBerry Stock Looks Way Too Undervalued After Q1 Earnings

BB stock hasn’t seen any appreciation lately, despite its continued progress on the IVY platform and early signs of the…

Read more »

A stock price graph showing declines
Tech Stocks

BlackBerry Q1 Earnings: The Declining Revenue Streak Continues!

Will BB stock break below $6?

Read more »

A bull outlined against a field
Tech Stocks

After the Recent Fall, it’s Time to Turn Bullish on 2 TSX Growth Stocks

With the kind of lows these TSX stocks have seen, the negatives appear to be priced in.

Read more »

man sitting in front of 3 screens programming
Tech Stocks

3 Ultra-Cheap Tech Stocks to Consider Buying

Three ultra-cheap tech stocks are interesting picks for their favourable business outlooks and long growth runways.

Read more »

Question marks in a pile
Tech Stocks

Crypto Selloff: Has the Bottom Shifted After the Interest Rate Hike?

The measures taken to control the inflation in the U.S. and Canada, including an increase in interest rates, can adversely…

Read more »