‘Barking at the Moon’: Dogecoin skyrockets 300% in a week, sparking bubble fears

Defying all the odds, meme-based cryptocurrency Dogecoin has risen by a whopping 300% in the last seven days. It has doubled in price in the last 24 hours, adding about $19.9 billion, hitting an all-time high of $0.29 on Friday.

Dogecoin, which was initially launched as a joke to mock other cryptos, is now a top-10 digital currency with a total market value of $34 billion, according to crypto market data site CoinGecko. It has delivered 12,600% in gains in a year and likely created a number of millionaires. 

The digital token’s impressive growth and its latest rally have been attributed by some to tweets by billionaire Tesla CEO Elon Musk. On Thursday, Musk again posted a cryptic tweet saying “Doge Barking at the Moon,” likely in reference to the popular crypto slang phrase “to the Moon.”

Musk has been calling dogecoin his “fav” cryptocurrency and “the people’s crypto.” However, some crypto investors have been raising concerns about Musk’s dogecoin tweets. Nic Carter, co-founder of Castle Island Ventures, warned that retail investors “are going to lose money on dogecoin,” calling it a “vehicle for speculation.”

An analyst at UK investing app Freetrade, David Kimberley, also said that “dogecoin’s rise is a classic example of greater fool theory at play.” He told CNBC that “people are buying the cryptocurrency, not because they think it has any meaningful value, but because they hope others will pile in, push the price up and then they can sell off and make a quick buck.”

Kimberley added that “when everyone is doing this, the bubble eventually has to burst and you’re going to be left short-changed if you don’t get out in time. And it’s almost impossible to say when that’s going to happen.

“This is doubly the case in the crypto markets where a small group of players often hold a huge chunk of the total number of ‘coins’ in circulation. That means it only takes one person to dump all their holdings for the entire market to tank,” he said.

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