The price of dogecoin has bounced between $0.73 and $0.42 over the last two days, and it all appears to be the result of a single person and the market sentiment they can conjure.
The meme-inspired cryptocurrency began to climb in value, as investors anticipated that any mention of dogecoin on SNL by the SpaceX and Tesla CEO would cause the price to spike.
“Similar reactions were noticeable after a number of Elon’s tweets relating to dogecoin, in which we saw a dramatic surge in prices before the hype dies out and its value declined,” notes Peter Hanks, an analyst at trading news site DailyFX.
True to his word, the self-proclaimed Dogefather made several mentions of cryptocurrency throughout his performance, even joking that he had bought some for his mother for Mother’s Day.
But in the end it proved anti-climactic, at least for the market. After climbing to yet another all-time high in the build-up to the show on Saturday, dogecoin’s price began to drop before a flash crash wiped out more than a third of its value. The price dive began towards the end of the show, when it became apparent that Musk wasn’t going to make any major announcements, and even suggested that the cryptocurrency itself was “a hustle” of some kind.
“The appearance over the weekend had been expected to mark a watershed moment for Doge, [but] comments from Musk sparked a sell-off in doge,” said Simon Peters, a crypto market analyst at the online trading platform eToro.
Less than a day after his appearance, however, Musk seemingly came to dogecoin’s rescue by posting a single tweet.
“SpaceX launching satellite Doge-1 to the moon next year,” he wrote, adding that the mission would be funded by the cryptocurrency and mark the first time that a meme has been sent to space.
The Doge-1 announcement not only stopped the price slide but also saw it rebound back above $0.50, up more than 10,000 per cent in 2021. And despite the huge price swings, dogecoin remains the top performing major cryptocurrency over the last 12 months.
The record price rally has been accompanied by record volatility, with a recent market report from the cryptocurrency exchange Kraken recording a monthly volatility reading of 442 per cent for dogecoin.
The momentum of these gains could conceivably continue, according to some analysts, provided continued support and publicity from high-profile figures like Musk.
“There has been much talk about getting Doge to $1, and whilst it has seemed like an impossible dream for a while, things are starting to pull in the right direction,” says Antony Portno, founder of cryptocurrency information site Traders of Crypto.
“Right now, it only needs another 50 per cent gain to get there. The way the market works, the price is only about the last trade and if the sellers hold back and the momentum is up, what’s to stop it.”
Dogecoin’s astonishing rise has seen it become the world’s fourth most valuable cryptocurrency – behind only bitcoin, Ethereum and Binance Coin – and some analysts believe that its renewed popularity could even be replicated by other fringe cryptocurrencies.
“Excitement for Doge’s Saturday Night Live debut will carry over into tokens with proven utility,” says Nick Spanos, a prominent investor within the cryptocurrency space.
“Doge is a powerful marketing tool, driving attention and adoption of crypto and decentralization as a concept. And in that respect, it is invaluable. I expect many people to cash in on their Doge profits in the coming days, and this is likely to boost the wider crypto market as a lot of this money will flow into other altcoins which have strong potential instead of it being converted into fiat money.”