Since the release of Bitcoin in 2009, there has been a frenzy of cryptocurrencies with different trading methods and ways to exchange or use them in an attempt to match Bitcoin. Over a decade later, the growth of cryptocurrency is on a steady rise. People who invested in Bitcoin early on are now using their returns to buy cars and apartments, while more and more cryptocurrencies are reaching this point as well. Each cryptocurrency has its selling point, and who’s to say that they wouldn’t achieve the same success that Bitcoin has.
Recently, there has been one particular cryptocurrency that has been making waves with its completely different approach in the way it markets itself. Created in 2013 by IBM software engineer Billy Markus and Adobe software engineer Jackson Palmer, Dogecoin was created as a peer-to-peer currency that could reach a broader market than Bitcoin. The idea was made through the basic modern marketing technique of applying what is currently famous into the product. At the time, the DOGE meme was all over social media, making it a great way to both attract attention and distance the new cryptocurrency from the others. Understandably, the circumstances of Dogecoin’s original idea brought some negative attention to the new digital currency, which might not have been a bad thing.
Dogecoin’s marketing scheme looked to have worked in the middle of 2020 when its price saw a sudden rise due to a trend in the app TikTok that wanted to get the coin’s price to $1. The beginning of 2021 saw a rise of over 800% in about a dayd4 to get to the price of $0.07. Along with the creation of several new and easy-to-use trading platforms, this trend continued through the rest of the month. Dogecoin had gotten to $0.08 with the help of mentions from people like Snoop Dogg, Gene Simmons, and Elon Musk. These celebrities have made their thoughts on Dogecoin very public through the use of different social media platforms, such as Twitter and Instagram. The meteoric rise of Dogecoin continued through to May, reaching $0.711, a greater than 20,000% increase in just one year.
This sudden surge shows the value that a good social media presence is generally helpful in marketing any product. A great example of this outside of cryptocurrency is the market value of Portuguese Footballer, Cristiano Ronaldo. The 36-year-old became the first and only footballer to become a billionaire, and there is no doubt that his over 250 million Instagram followers (highest in 2020) are a big part of that. These numbers show the undeniable importance of social media in marketing any product.
However, a big downside to this marketing model – the fall can be just as fast as the rise. On May 8, 2021, Dogecoin suffered a 34% drop after one of their main social media endorsers, Elon Musk, appeared on Saturday Night Live and made a few jokes about the digital currency. Dogecoin dropped to $0.401, bringing its value back just as quickly as it had risen. The day after. Musk and SpaceX announced a mission to the Moon that is fully funded through Dogecoin, meant to launch in the first quarter of 2022. Mark Cuban, the Dallas Mavericks owner, similarly looked to legitimize the cryptocurrency by allowing people to pay for the NBA team’s game day tickets through Dogecoin.
While the numbers do speak for themselves, there are still several questions about the legitimacy of Dogecoin. The general issue with social media-driven products is the lack of reliable sources for said product’s real value versus its perceived value. However, there is no question that through this marketing model, the reach is much larger. There is also that fine line between being a joke, especially due to the nature of the digital currency’s creation, and the legitimacy of Dogecoin. The key piece of information for traders and possible traders now is to try to look at how Dogecoin surfs that line before deciding on their next move.
