Can Dogecoin Reach $1? | The Pied Fool

Typically, it has been an extremely volatile year for Dogecoin (DOGE 2.19%). While the overall cryptocurrency market has gained 20% in value, now worth $2 trillion, the dog-themed token is up just 5% in 2024 (as of August 6).

Dogecoin is trading at 86% of its peak price below $0.74 in 2021. But can this cryptocurrency skyrocket more than ten times from today’s price to one day hit the $1 mark, important from psychological point of view?

The Dogecoin Roller Coaster

Dogecoin reached its all-time high in May 2021, during which meme stock mania took over the stock market. This excitement has led to bullish activity in the crypto industry as well. As one of the most speculative tokens out there, Dogecoin has benefited enormously.

But in the crypto market, what goes up fast usually goes down fast. That’s what happens when the price of a particular token is driven more by speculative behavior than any kind of fundamentals.

For example, the price of Dogecoin has always gained one of its well-known supporters, adze founder and CEO Elon Musk is talking about it publicly. There is hope that the social media platform owned by the tech mogul, X (formerly known as Twitter), could integrate Dogecoin as a potential payment enabler.

However, any excitement is usually short-lived. This also happened in 2024. From the beginning of this year to March 29, Dogecoin has increased by 144%. Since then, it has fallen 57%. I don’t think there’s any reason to believe that this kind of price action is going to change. And that makes it difficult for anyone to invest.

Focus on the fundamentals

Why would Dogecoin need to increase tenfold to reach $1? Actually, it’s a simple answer. There has to be a strong demand for people to want to hold Dogecoin in their portfolios. I’m not sure if this will happen in a significant way.

Dogecoin was created to be an easy rival Bitcoin (CRYPTO: BTC). Dogecoin aims to be a payment network and also runs a proof-of-work consensus protocol. But that’s probably where the similarities end.

Bitcoin has become a legitimate financial asset over the years. Investors find immense value in its decentralized nature and fixed supply cap. Bitcoin is not only taking over gold as a popular store of value, but the network is a competitor to the current monetary system.

On the other hand, there are currently 145 billion Dogecoin tokens in circulation. This figure expands by 10,000 every minute and there is no upper limit. This couldn’t be further from Bitcoin’s scarcity level. In fact, the abundant supply of Dogecoin makes it difficult for the price to rise significantly. T

The community support that Dogecoin has been able to attract is admirable. It is currently the ninth most valuable blockchain networkwith a market capitalization of USD 14 billion.

However, I think it has virtually no use. And it doesn’t have that many developers working on the development of the network. This does not bode well for its long-term viability. Ultimately, the market may begin to question whether Dogecoin should even exist.

For someone looking to invest their hard-earned savings into an asset, there are many better options. Digital assets like Bitcoin and Ethereum could satisfy your crypto allotment. There are even growth technology stocks which could provide a better alternative for investors who are comfortable taking more risks in the equity markets.

Not only do I see Dogecoin as an investment you’d be better off not making, but I don’t see its price ever reaching $1 per token.