At $50B, Dogecoin market cap bigger than Barclays & ING

04/23/2021

Dogecoin (DOGE) has been making news in April. Initially, it was trading in its usual $0.05 range. Then, on April Fools’ Day, Tesla CEO Elon Musk tweeted a joke about the coin.

SpaceX is going to put a literal Dogecoin on the literal moon” — Elon Musk

Within two hours, the price rose by more than 35% to a peak of $0.07 before cooling off but still holding on to its gains.

The next spike in price came on April 14, with the value of a single token doubling within a single day to break the $0.10 mark. This time Musk, tweeted a picture of the famous painting by Spanish artist Joan Miró, saying “Doge barking at the moon.” This tweet pushed the price to a high of $0.45 on April 16.

The price surge took Dogecoin all the way up to ranking fifth in the top 10 cryptocurrencies by market capitalization. The market cap also briefly passed the $50-billion mark, which is a high figure for a coin that was conceived as a joke. Even after a 15% correction, the powerful rally catapulted Dogecoin’s market capitalization above well-established financial institutions like ING, Barclays and Credit Agricole.

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Is it another pump and dump scam?

DOGE is a hugely inflationary coin by design without a decided maximum supply, which entails that there are 5 billion new coins entering the circulating supply each year. Due to the high supply, there is always an endless downward pressure on the token.

On the possibilities of this being another instance of a pump-and-dump scenario, scrutiny reveals that the rally has been controlled by a single entity that has accumulated at least $1.3 billion worth of Dogecoin and abused the futures market by baiting shorts into creating a negative funding cycle that led to a derivatives blowout in excess of $760 million of liquidations.

This same player marked up the price of the token many times while feeding into the social media narrative surrounding the meme token. Apparently, the player liquidated their spot holdings, creating over $760 million worth of liquidations in the derivatives market.

What’s the future like?

There are currently 92 tradable assets surpassing a $156 billion market cap. Citigroup, Morgan Stanley, Unilever and Shell are all $150 billion market-cap companies and, therefore, would be below Dogecoin if somehow its fan base manages to push its value above $1.

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