The author of this article is Peter Guo, from PayPal Finance, published with authorization

Judging from the current situation of Dogecoin's recent daily volatility of more than 20% and the highest retracement of nearly 50%, this obviously should not be a follow-up choice for prudent investors.

Dogecoin (DOGE), which has been silent for more than two years, has recently become the focus of much attention in the encryption market.

"Dogecoin has increased by more than 400 times in one year" has become a hot topic, and more than 140,000 people have even called on Amazon to accept Dogecoin as a payment method.

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1. The Past and Present of Dogecoin

Dogecoin (DOGE) was born from a joke.

In 2013, a picture of a Japanese Shiba Inu became popular on the Internet. At this time, Bitcoin entered the peak stage of the bull market at that time, and cryptocurrency became the focus at that time.

Adobe Australia employee Jackson Palmer joked on Twitter: "Invest in Dogecoin - I'm sure it's the next big thing."

After getting support from many netizens, he quickly registered the domain name Dogecoin.com, and imitated Bitcoin to make a picture of Dogecoin.

Then another American programmer fan, Billy Markus, referred to the Bitcoin source code and used the Litecoin Scrypt algorithm to create such an altcoin.

Different from BTC's "digital gold" positioning, Dogecoin has been "divided" from the currency circle since its inception. Its circulation is unlimited, one block per minute, and an annual inflation rate of about 5% is used to offset the loss of coins.

In fact, the Dogecoin project itself does not have many bright spots, and the founder also withdrew later. Instead of exaggerating its advantages, it is better to say that the tipping culture prevailing in the United States has continued the value of Dogecoin.

Dogecoin is mainly used to pay tips, and the common scenario is to reward and motivate excellent content on the Internet. In addition, it also acts as a general cryptocurrency payment for goods or services, and exchange for other Token functions.

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Who fueled the bull market?

Dogecoin, which is harmless to humans and animals, has experienced many violent bull and bear markets, and even the founders can't understand it.

The first bull market: From the beginning of March to the end of May 2017, this was the early stage of altcoin popularity in the cryptocurrency market. Retail investors flocked into the market, and Dogecoin quickly jumped to a record high of $0.0042 on the back of the Bitcoin bull market.

The second bull market: From November to December 2017, Dogecoin soared to $0.002 in two months, and it was also in the crazy period when Bitcoin soared 1.7 times.

The third bull market: From April 10th to 20th, 2018, the currency price rose all the way to 0.006 US dollars. This is also the shortest duration of Dogecoin’s previous bull market, with an increase of only 100%. A big rebound.

The fourth bull market: From late August to early September 2018, Dogecoin rose nearly twice in the bear market of the entire encryption market. The reason was that the "Zhengyu Group" registered in Heilongjiang operated a fund board and called on members to buy in large quantities Due to Dogecoin, public opinion began to criticize Dogecoin as an MLM tool.

Of course, some people pointed out that the initiation point of this bull market was due to the combination of Dogecoin and Ethereum (ETH) to form the idea of ​​"Doge Square", but during this period of bull market, Ethereum did not rebound, and finally this kind of smart contract The bridge plan also fell through.

The fifth bull market: The bull market that started at the end of January 2021 is very different from the previous ones. The rise of Dogecoin is far greater than the previous waves of bull markets in terms of rise and fall and duration.

Under the premise that Dogecoin itself is lackluster, it seems that the reason for its rise can only be attributed to the flag-waving of Dogecoin enthusiasts during this period, including Elon Musk, Carole Baskin, Mark Cuban, Genne Simmons, Snoop Dogg, etc. Celebrities and organizations like Wall Street Bets, SatoshiStreetBets, etc.

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PayPal Watch:

By chance and coincidence, Dogecoin was born because of a joke, because of the rapid spread of the tipping culture, continued because of matching the real utility, and because of the soaring and plummeting social hype, Dogecoin has become a beautiful landscape in the cryptocurrency market.

Judging from the performance of Dogecoin's previous bull and bear bears, speculative hot money often seeks other targets to increase returns when mainstream currencies such as Bitcoin are at a high level. There are also concerns about potential negative impacts.

References:

References:

1、https://baijiahao.baidu.com/s?id=1697067599793517862

2、https://www.8btc.com/article/6591687

3、https://www.coindesk.com/is-dogecoin-the-next-bitcoin