Thousands of new stablecoins and altcoins are being minted every day, which has resulted in an oversupply of cryptocurrencies on the market. Some assets have grabbed the cryptocurrency world by storm, while many remain unheard of. One such cryptocurrency that has excelled among the most highly regarded coins in recent months is Dogecoin.
The value of cryptocurrencies increased by billions of dollars last week amid a bullish market rise, in part due to a 40% gain for dogecoin after Elon Musk, the richest man in the world and self-described “Dogefather,” finished taking control of Twitter.
Dogecoin has recently evolved from a meme token into a viable cryptocurrency thanks to endorsements from famous people such Tesla CEO Elon Musk. Dogecoin is probably going to blow up for this and a lot of other reasons. In this article, we will know why the currency is going up.
Why Dogecoin is a better option than other cryptocurrencies?
Environmentally responsible digital asset
There’s a good reason why millions of people love dogecoin. The environment is frequently regarded as a top issue by young cryptocurrency enthusiasts. In light of this, Dogecoin’s appeal as a crypto alternative might be increased by the substantially reduced amount of electricity needed to mine and use it compared to Bitcoin. Compared to Bitcoin’s 707 kilowatt-hours of electricity used each transaction, Dogecoin requires merely 0.12 kilowatt-hours.
Strong community backing
Due to the strong community support, Doge is a cryptocurrency that everyone should purchase. The community is the primary reason behind Dogecoin’s enormous success. Celebrities like Snoop Dog and Paris Hilton have sided with Elon Musk, the CEO of Tesla, in support of Dogecoin. The success of the coin was facilitated by the celebrities’ massive fan bases and sway over their users. People who previously knew nothing about cryptocurrencies like Dogecoin are now considering investing in them.
The meme cryptocurrency also has a strong support. A cryptocurrency’s development team determines how wonderful it will be. Long-term performance is better when the core programming team is more dynamic. They can create improvements that adapt the cryptocurrency to the shifting demands of the commercial sector. They may also take care of concerns like security, which is essential for the long-term growth of any cryptocurrency. Popularity alone is essential given the speculative nature of cryptocurrencies.
In terms of valuation, Dogecoin is highly valuable because people think the token’s value will rise. DOGE has given investors an astounding 20,000% gain in the last year alone. Doge is anticipated to explode as a result of the support from the community and media attention, so it’s a not a bad idea to buy DOGE right away.
Inflationary benefit
Dogecoin is a fantastic investment option since it offers numerous advantages over Bitcoin. Unlike many other cryptocurrencies, including Bitcoin, the total number of DOGE tokens that could be mined is unbounded. As a result, the annual maximum number of extra Dogecoin tokens that can be mined is 5.26 billion.
Given that there are now more than 132 billion coins in use, this limited mining rate guarantees that Dogecoin’s inflation rate will gradually decrease over time while still offering a motivation to continue mining it.
The amount of DOGE coins in circulation was expected to increase by 4.1% by 2021, but only by 3.9% by 2022, according to analysts. By 2025, dogecoin inflation will reach 3.5%, then 3.0%, 2.3%, and 1.9% by 2030, 2040, and 2048, respectively. The coin could conceivably experience deflationary conditions at some time if the attrition from lost Dogecoin wallets exceeds the ever-shrinking inflation produced by mining.
In conclusion, even if Dogecoin is mathematically “infinitely inflationary,” its predictable diminishing inflation rate could give it a more stable value than fiat currencies.
The goal of cryptocurrency was to replace fiat currency with decentralised ones. The first cryptocurrency, Bitcoin, failed on this front. Its objective has changed, and it now aims to serve as a valuable shop. Due to its deflationary nature, Bitcoin and similar technologies are failing to deliver on this front.
There are a number of reasons why deflationary currencies (like Bitcoin) might never be used as money. But Dogecoin’s tendency toward inflation ranks it among the best cryptocurrencies over the long term. Therefore, making an investment in Doge now could result in enormous gains later on.
The Bottom Line
Read more: How to take a safe exit from highly uncertain cryptocurrency world?
It matters where cryptocurrencies rank in terms of market capitalization. It makes cryptocurrency interesting to novice investors looking to wager. Today, Dogecoin is a top-tier cryptocurrency that has drawn admirers and investors from around the globe.
Today, anyone entering the market needs to take Dogecoin seriously. This will most likely increase its value force moving forward in addition to presumably extending its liquidity. This is a great reason to remain onto Dogecoin right now, anticipating future profits. Given these elements, it is safe to conclude that Dogecoin will most likely take off. But keep in mind that Doge is uncertain, much like other cryptocurrencies. Dogecoin investors shouldn’t invest any funds they can’t afford to lose in the cryptocurrency.