Whilst the markets continue to tank, one coin – which arguably started out as something of a joke – has been moving in entirely the opposite direction.
Dogecoin – which originally began as a fork of Litecoin in 2013 and which has never claimed to fulfil any specific function as such – has seen its price climb by a factor of 2.5 in value over the course of the last three weeks whilst the rest of the markets have lost, on average, just over 10% over that same period.
Over the last twenty-four hours, over $1 billion USD in Dogecoin has been traded – second only to Bitcoin – representing treble the equivalent figure for Ethereum. “Dogecoin may have started as a joke, but their community is now the envy of the crypto world,” states Kevin Rooke, crypto-analyst and commentator on his Twitter account.
2017: Dogecoin is a joke
2018: Dogecoin is making your cryptocurrency look like a joke
Dogecoin’s 24hr tx volume is:
3x of BCH
8x of LTC
13x of DASH
35x of DCR
41x of BTG
Dogecoin may have started as a joke, but their community is now the envy of the crypto world pic.twitter.com/YXIzqJWHez
— Kevin Rooke (@kerooke) September 10, 2018
The explanation for Dogecoin’s behaviour appears to represent something of a conundrum for most market analysts – particularly as the coin itself offers no functional value.
However, one analyst has stepped forward to offer an explanation which may offer some insight into the phenomenon: “This could simply be the law of large numbers,” states Ali Yazbek, crypto market analyst. “When you have a large enough number of coins on the market generally moving in one direction, it would be unusual not to see at least a handful moving in the other direction. And when the market then spots what it believes to be a trend-bucker, it will have a tendency to jump on top of it, further compounding the effect.”
This may be a sign, in other words that – even in 2018, crypto’s Great Year of the Shaking Out – irrational exuberance and/or gloom continue to be a major driver in overall market behaviour.