Dogecoin became one of the most talked about cryptocurrencies over the past couple of years.
In part due to the fact Dogecoin was set up as a meme, or joke cryptocurrency. It was never intended to be a serious project which became life changing for the founders.
An internally rally was driving an initial momentum of success until Tweets from Elon Musk, and a skit on Saturday Night Live, sent the value of Dogecoin to the moon almost overnight!
Everyone was buying Dogecoin, looking to cash in on the cryptocurrency gold run, just like in the Klondike in the 1890’s.
Dogecoin launched back in 2014 and started with an initial launch price of $0.00030 per coin.
This meant someone who invested just $1,000 in to Dogecoin would hold 3,333,333 Dogecoin.
In July 2021 Dogecoin reached an all-time record high price of $0.5811 a coin.
Although $0.58 a coin doesn’t sound much, it is considering the climb needed from $0.00030 to reach a $0.58 value.
An investment of just $1 as late as December 2020 would see a return of $19,370 just over 6 months later, that’s a $19,369 profit or 19,700,000% return on investment!
As with most cryptocurrencies in the bear run of 2022, the price of Dogecoin fell drastically and reduced its overall by 80% from its all-time high, but this is still a 2,000,000% return on investment from initial offering.
DOGE will need to just 10x its value in order to reach a $1 per coin valuation.
This would mean an increase of 1000%, which is a significant climb, but that’s nothing compared to the 19.7m% climb it achieved between 2021 and 2022.
One of the main factors that will determine whether Dogecoin can reach $1 will be its current market capital.
Market capital is one of the biggest deciding factors as to whether a cryptocurrency has the potential to 10x its current price.
It is worth noting that Ethereum managed to increase its price from a low of $0.81 to a high of $4,300, and Bitcoin managed to increase its price from a low of $0.09 to a high of $51,000.
Based on these price increases and its recent growth, it seems feasible that Dogecoin, could increase from $0.10 to $1.
But ultimately, it’s the market capital that needs to be analyzed to see the true potential.
Market Capital in Cryptocurrency Explained
The simplest way to understand market capital in the cryptocurrency world, which essentially is the true market value of the crypto, is to look the number of coins in circulation and its current market price.
Multiplying one number by the other provides a total value of the cryptocurrency based on market value.
It can be shown more simply using the calculation:
Number of tokens in circulation * Trading Price = Market Value
This is the most important value to use to see whether Dogecoin has a chance of reaching $1 a coin.
If a coin has a very high market capital, even if it has a low price, it indicates growth of this large volumes is very difficult
On the other hand, a very low market capital, even with a high price, can show the coin at least has the potential for large growth and very high returns.
This is the most important value to use to see whether Dogecoin has a chance of reaching $1 a coin.
Whether a cryptocurrency price increase or falls is down to demand, so it needs to be able to find buyers and investors to increase at all, let alone by 1,000%.
We can look at this using an example:
A cryptocurrency with 5,000,000 circulating coins may have a trade value of $5 a coin, giving this cryptocurrency a market share of $25,000,000.
Another cryptocurrency with 4 billion circulating coins may have a trade value of $1.50 a coin, giving this cryptocurrency a market share of $60,000,000,000.
Although the second cryptocurrency has a current price of $1.50 compared to the first cryptocurrency of $5, it is the market value of the $5 a coin cryptocurrency that is worth less.
3,000 times less value in fact.
It will be relatively easier for the first coin to increase 100 times in value to become worth $500 and have a market capital of $2.5billion than it will for the second coin to increase 100 times in value, become $150 a coin, but have a market capital of $6trillion!
Market capital is a better indicator of potential future growth when comparing against other cryptocurrencies, than the value of the coin.
Market Capital of Dogecoin
The market capital of Dogecoin, like any cryptocurrency on the market, will see its market capital fluctuate daily. This can often be seen changing minute by minute.
Although the number of coins in circulation is relatively static, the price can change every minute based on current supply and demand, and so using our calculation in the last paragraph it will mean the market capital can and will fluctuate.
Unless there is a dramatic market shift in to, or away from, Dogecoin the market capital should remain reasonably steady.
At the current time the market capital of Dogecoin is approx. $12.1billion!
This provides Dogecoin a huge market capital and is currently the ninth biggest cryptocurrency.
Even with such a huge market value, it is small in comparison to the two biggest cryptocurrencies, Bitcoin and Ethereum, which have current market capitals of $440billion and $199billion respectively.
Dogecoin is long regarded as one of the top three most recognized cryptocurrencies due to media coverage and Elon Musk. Although other coins such as XRP and Cardano rank higher in terms of market capital, Dogecoin already has huge investment by celebrities, media names, and crypto investors.
With so much invested into what is often regarded as a meme coin, Dogecoin to reach $1 it would need a huge surge in investment.
Although it climbed 19.2m% in a short space of time, it grew from a market capital of $40,000 to what is now $12.1billion.
For Dogecoin to reach $1 it would need to have a market capital of $121billion!
This would make Dogecoin the third largest cryptocurrency in the market.
Why Market Capital is so Important for Dogecoin
It isn’t possible to take a cryptocurrency price and compare it, in terms of size and value, to another cryptocurrency.
In fact, the price is almost completely irrelevant.
As we have seen, a cryptocurrency at $1.50 maybe a lot more valuable than one with a current price of $5.
For example, if crypto J has a current trading price of $2 but there are 20 billion coins in circulation it will have a much harder time increasing to $5 compared to the chances crypto K has increasing from $4 to $400 which has a current circulation of 50 million coins.
This is because of the amount of money within the overall market and the amount already invested into crypto J.
In the example above crypto J already has a valuation of $40billion, which would make this crypto the sixth most valuable on the market.
Whereas crypto K only has a valuation of $200million.
If crypto K began to gain traction and started to see substantial gains, the market would shift and potentially sell their holding of crypto J in exchange for crypto K, seeking a higher return.
Just 10% of the amount held of crypto J being sold off and moving into crypto J would see crypto K increase 2,000%, or 20x.
On the other hand, all holders of crypto K could sell and move this amount in to crypto J, and crypto J would increase by just 0.1%.
Therefore, a cryptocurrency with a much smaller market capital has a much better opportunity of increasing significantly if demand increases, and money moves across from other cryptocurrencies.
To understand whether Dogecoin DOGE can reach $1 let’s compare its market capital with other cryptocurrencies.
Dogecoin DOGE Market Cap vs Other Cryptocurrencies
Here is a table showing how Dogecoin cryptocurrency compares to other top coins such as Bitcoin, Ethereum, Solana Dogecoin, Shibu Inu, Polygon MATIC and Decentraland:
| Cryptocurrency | Market Value |
|---|---|
| Bitcoin | $440 Billion |
| Ethereum | $199 Billion |
| Dogecoin | $12.1 Billion |
| Polygon MATIC | $10.5 Billion |
| Solana | $8.6 Billion |
| Shibu Inu | $8 Billion |
| Decentraland MANA | $1.3 Billion |
| The Sandbox | $1 Billion |
For Dogecoin to reach $1 in would need a market capital of $121billion and become by far the biggest cryptocurrency.
Could Dogecoin Reach $1
It is certainly possible for Dogecoin to reach $1.
At this valuation Dogecoin would still be in the shadow of Bitcoin, and be worth just 25% of the total valuation of Bitcoin, but it would still require a major shift in the market.
Although Dogecoin began as a meme coin, and a joke in terms of cryptocurrency, the investment behind the coin and notoriety has the creators thinking seriously about its next steps.
The Dogecoin developers have plans, including potential DeFi projects and a Metaverse consideration.
Dogecoin has behind it a recognizable brand name, and support from Elon Musk who recently said it would accept Dogecoin as payment for Tesla cars – and that he actually intends to send a Dogecoin replica coin to the moon!
With media attention like this, it would not be out of the realms of possibility for Dogecoin to increase dramatically over the coming years.
