The recent rise of meme-inspired cryptocurrency dogecoin has resulted in several dollar millionaires.
Data provided by cryptocurrency data tracking platform BitInfoCharts indicates, that as of April 23, 2021, at least 1,321 dogecoin wallets each had a value of at least $1 million despite a recent 16% decline in asset’s price over the last 24 hours.
The new crop of dogecoin millionaires reflects the asset’s rise alongside other cryptocurrencies like bitcoin. Notably, doge has attracted additional enthusiasm boosted by endorsements from celebrities like Tesla (NASDAQ: TSLA) founder Elon Musk who has constantly expressed support for the asset.
Backed by the huge support from the community and public figures, doge soared to an all-time high above $0.45 on April 16, 2021.
A sharp decline
However, the asset has experienced several corrections to trade at $0.22 by press time, having dropped by 16.13% in the last 24 hours. Despite the correction, doge’s value has soared 5,650% on a year-to-date basis.
Doge’s sharp decline began on April 21, barely 24 hours after fans celebrated ‘Doge Day.’ Through social media platforms, doge supporters posted memes and messages to push the asset towards the $1 mark.
Notably, doge’s rise has drawn comparisons with the GameStop stock that hit record levels fuelled by activity on social media platform Reddit.
Warning against dogecoin’s rally
Due to the surge in doge, backers have compared it to bitcoin’s rally. However, former hedge fund boss Mike Novogratz has cautioned against comparing the two. According to Novogratz:
“It’s very wrong to compare doge to bitcoin or the other coins. The amount of CAPEX and OPEX that goes into keeping the Bitcoin network decentralized and up and running each year is immense,” added Novogratz. “doge is a dog, no pun intended.”
Novogratz further called for caution when investing in doge. According to the Galaxy Digital CEO, dogecoin’s spike in value is a ‘retail phenomenon’ due to the federal reserve’s supply of more money into the economy.[binance]