Elon Musk has been professing his love for Dogecoin for a few years now — his first post about it goes back to 2019, when he called it his “fav cryptocurrency” — and he has since been sending the crypto on a rollercoaster ride following each one of his multiple posts about it. And earlier this month, in a significant move and a further stamp of approval for the crypto, Tesla updated its methods of payments to accept DOGE, according to its website.
This sent the price of DOGE soaring, according to CoinGecko. And as of May 10, the price was up 3.5% in the past week, and a whopping 94.1% in the past year, according to CoinGecko data.
Yet, the trajectory of DOGE is tricky, with many alternative cryptocurrencies and memecoins being inherently extremely volatile. And while Musk continues to have a significant impact on DOGE’s popularity, and price, whether its path is tied to him remains to be seen.
Difficult To Predict What DOGE Will Be Worth in Five Years
Patrick Gruhn — lawyer, entrepreneur, CEO of PMX Technologies and former (now defunct) FTX executive — argued there is no way to really predict what DOGE will be worth years from now, especially with “the absolute hype around memecoins on Solana as well.”
However, Gruhn noted that there is a very interesting point regarding memecoins in general, as they are often seen as a form of protest.
“The argument goes like this: ‘If the government is going to inflate and tax my hard-earned money away paying off their debts, enriching their friends, and buying political votes for re-election, then I’m going to simply use a different monetary system altogether that they can’t mint. And it’s going to be a dog on the face of the coin, because that’s what I think of what’s currently represented by the faces currently on our physical coins,’” he said.
“Seeing as Elon is creating a whole ecosystem of software and hardware innovation, perhaps he could stand with this protest and allow Dogecoin to be used with his products/services, thereby ensuring its demand. Then, of course, the value in five years can be substantial,” he added.
Other Experts Weigh In
And while other experts agreed with the premise that it’s difficult to predict the price of memecoins due to their volatility, one thing is certain.
“Memecoins are here to stay — at least for the time being,” said Jeff Owens, co-founder of Haven1.
Owens noted that despite lacking underlying technology or a tangible use case, the memecoin frenzy over the last few months highlights that these assets have some value — value which is predominantly reliant on market sentiment.
What’s more, the institutional adoption of memecoins and their entrance into the wider financial landscape, such as Tesla’s move, will push the hype further, he said.
However, he also stressed that these early steps of adoption haven’t prevented memecoin volatility.
“By nature, they’re a far more volatile investment than other leading cryptocurrencies like Bitcoin or Ether,” he said. “So this is something to keep in mind when investing in Dogecoin, or any other meme-themed coin over the next five years.”
Tayler McCracken, editor-in-chief of Coin Bureau, said DOGE also faces significant competition in the memecoin space, with tokens such as Pepe, Shiba Inu, Bonk and countless others taking market share.
Memecoin investors, he said, are quick to jump on the latest trends in search of “the next DOGE,” which could further dampen Dogecoin’s performance.
What About Musk’s Continued Impact on Doge? Is Doge’s Trajectory Tied to Musk?
As Rebecca Liao, CEO of Saga, noted: “Attention is an incredible asset in the digital economy that the world increasingly operates in.”
“We’re still in the early stages of this trend playing out, and most memecoins, I should caution, will never be worth much in the longer term,” she said. “But for tying together digital communities, memecoins have a lot of pull and impact. The fact that many of them are so funny and silly adds to this pull, as Elon Musk clearly has shown with his affinity for Dogecoin.”
As for Musk’s continued impact on the crypto, Coin Bureau’s McCracken deemed it “the elephant in the room.”
According to him, while many consider Elon the de facto spokesperson for Doge, there is a risk that he may become bored with the coin and move on to something else.
“There is a significant ‘key-man risk’ when the price of a cryptocurrency is heavily influenced by the adoption and motivations of a single individual,” he said.
He noted that when Musk was asked why he loves DOGE so much, he pointed to reasons around the humor in the irony of it.
“Elon is uniquely positioned to integrate Doge into multiple different facets of society as a payment method,” he added. “Depending on Elon’s actions and vision for things like sending Doge to the moon (literally) and accepting Doge for Tesla products — with Elon’s backing, Dogecoin’s price is likely to remain relevant and a strong performer in the crypto industry.”
McCracken added that even if Musk were removed from this situation, DOGE would still likely remain relevant, although at a more muted pace.
“It has become a true blue-chip bulwark for the memecoin community and with Memecoins being among the top-performing projects of all time, even without Elon’s promotion, Dogecoin will likely continue its long-term potential,” he added.
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