After an extremely turbulent 2020, it was inevitable that 2021 was going to be off to an interesting start, and investors from many different markets certainly got their fill as there was a huge community reaction to see change. The biggest is certainly came from GameStop and the ongoing short saga that has seen ups and downs throughout the past couple of months, but others have also seen huge swings as bitcoin managed to top $60,000 multiple times this year and Ethereum saw the big benefits of the NFT market becoming strong for a short time. The surprise for some has come from the growth of ‘meme coins’, particularly with Dogecoin which has seen a growth of more than 8,500% so far this year, but what’s behind the growth?
For many it had been pitched as a battle against the big guy with the underdog coming out on top, for stock trading it was Reddit vs Wall Street that led to the enormous growth of GameStop. The emergence of Dogecoin had been something independent growing to poke fun at the other alternative coins trying to challenge bitcoin way back in 2013, and even in other industries like gaming similar had been seen many new game choices looking to challenge the bigger names, coincidentally now also being more willing to accept crypto names like doge as a payment option. It has also even led to more looking to play high stakes, with this form of payment, set to grow this part of the industry further. The question many will be asking now however is whether or not this same momentum and traction can be continued, or if things will start to taper off and even fall flat?
There are a few things supporting continued interest – the first is within the celebrity interest that places a bit of hype on the different markets involved, names like Elon Musk have been vocal in all things crypto and in some instances have certainly been instrumental in big rises and dips with acceptance of bitcoin as a purchase option for Tesla, as well as others like Snoop Dogg who have also voiced support for the meme coin too. For others, it has been a chance to get in somewhat early to cover a previous missed opportunity with bitcoin, those who jumped on board early had the opportunity to become millionaires over night with the biggest coins, and whilst Dogecoin still remains relatively small in comparison, it still holds over $50bn market cap, with some collectors looking back to their old wallets to find huge sums of the coin waiting.
The future for these coins and many other will certainly be interesting, although interest may start to wane by the end of the year it’s certainly possible that many will go on to find huge numbers in the meantime and may provide another opportunity for those who missed out on the first wave to cash in on the second.