Dogecoin has caught many peoples' attention in the cryptocurrency world after Tesla CEO Elon Musk endorsed it. With bitcoin surging to record levels and people making big money with it, many people want to know dogecoin's price prediction. Could dogecoin also be a good investment? Will dogecoin's price hit $1 in 2021?
To assess whether dogecoin can rise above $1, you should look at the factors that could take it up or pull it down. It's also important to understand the cryptocurrency theme in general.
What dogecoin is known for
Dogecoin is best recognized as the cryptocurrency that stemmed from an online joke and rose to become a serious rival to bitcoin. Many dogecoin fans still refer to it as the “joke currency.” The altcoin is created by Jackson Palmer and Billy Markus. It has been accepted on many crypto exchanges and trades under the ticker symbol “DOGE.”
Musk has said that dogecoin is his favorite cryptocurrency. The electric vehicle billionaire hasn’t offered his dogecoin price predictions, but he thinks that the altcoin has great potential. For example, Musk has suggested that dogecoin could become the global financial system's cryptocurrency standard.
Although Musk’s shout-outs have helped dogecoin's price, little is known about his dogecoin holdings. The billionaire revealed in May 2020 that he only owned 0.25 bitcoins, which a friend gifted him.
How dogecoin did in 2020
The cryptocurrency world made a range of dogecoin price predictions in 2020. Some people expected a boom, while others predicted a burst for the altcoin. At the end of the day, dogecoin gained more than 130 percent in 2020. The amount looks great for a tiny altcoin vying for attention in a crowded crypto scene. Bitcoin and Ethereum gained 300 percent and 460 percent, respectively.
Musk’s tweets and the TikTok campaign helped boost dogecoin's price in 2020. The shift to online shopping in the middle of the coronavirus pandemic also helped the currency.
Dozens of online merchants from snack vendors to ebook sellers and web hosting providers accept dogecoin as a payment. Many people looking to pay with cryptocurrency wanted dogecoin.
Will dogecoin's price hit $1?
A 2020 TikTok campaign sought to lift dogecoin's price to $1. At the time, the cryptocurrency was at $0.0023. The campaign managed to drive dogecoin's price up by 50 percent in 24 hours and 95 percent in one week. For now, hitting $1 is a dogecoin investor’s dream.
Although there’s a possibility of dogecoin hitting the $1 mark, the altcoin still has a long way to go. Dogecoin’s $1 price milestone could mark a major turning point for the cryptocurrency. Reaching $1 would in some way prove that it’s more than a joke.
What to expect from dogecoin in 2021
Dogecoin started the year with a bang and more than doubled in the first week of 2021. It’s too early to know what the year has in store for Musk’s favorite cryptocurrency.
However, it’s highly possible that dogecoin might end the year higher, perhaps close to $1. Celebrity endorsements have worked well for dogecoin's price, which means that it should continue to benefit from Musk’s favorable Twitter mentions. The altcoin would likely crash if Musk turns bearish on it. Dogecoin's price should also benefit from more people adopting it as a medium of payment.
Dogecoin's long-term outlook
Altcoins like dogecoin are tied to bitcoin in many ways. Sometimes they rise alongside bitcoin, while other times they are left behind as bitcoin overshadows them. Some altcoins will start their bull run after bitcoin has reached a peak and investors start looking for the next big thing in the crypto world besides bitcoin. If the search for the next bitcoin is strong in 2021, dogecoin could advance significantly toward the $1 mark.
Right now, the cryptocurrency theme favors dogecoin. Large investors are moving into bitcoin and crypto assets in general to explore investment opportunities outside traditional asset classes. The COVID-19 pandemic is fueling interest to pursue unconventional investments, especially since heavy money printing by central banks has heightened the inflation risk.
Also, many investors see bitcoin as digital gold, while they see Ethereum as digital oil. Dogecoin is trying to fill the gaps that bitcoin and Ethereum have left — a cryptocurrency that can be used for everyday transactions. The altcoin’s low value makes it ideal for small dollar payments.
A major drawback in a bullish dogecoin price prediction is that many people still view it as merely a joke and not as a serious investment, which may limit its uptake and drag the price. However, dogecoin's active and highly dedicated online community is trying hard to change the altcoin's image.