A year ago,the asset was valued at $US315 million. Now it is worth nearly $US90 billion.Credit:Getty
It’s the latest milestone in a year of speculative excesses for a market Nouriel Roubini once described as “the mother of all bubbles.” While in the past,trillions of dollars in stimulus by governments and central banks might have triggered a rush into gold for the inflation-wary and risky stocks for the intrepid,a deluge of cash this time round is flooding into the nascent crypto market.
Few illustrate this better than Dogecoin,a so-called memecoin that’s become the destination for a horde of day traders egged on by Internet buzz and a self-propelling buying frenzy. A potential trigger for the latest leg up:Tesla co-founder and crypto fan Elon Musk is appearing onSaturday Night Live this weekend,spurring speculation he may talk up Dogecoin again on the comedy show.
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“When you think about the full spirit of what this crypto revolution is,there’s something pure in what Dogecoin has done,” Mike Novogratz,founder of Galaxy Digital Holdings,said onCNBC. “I worry that once the enthusiasm rolls out,there are no developers,there’s no institutions coming in. But it’s got the moniker of the people’s coin right now and it’d be very dangerous to be short.”
The overnight gain took Dogecoin’s one-week advance to 118 per cent and its value to $US87 billion in Wednesday trading,according to CoinMarketCap.com data,eclipsing the largest exchange-traded gold fund and even stocks like Fedex and Snap. A year ago,the asset was worth just $US315 million.
It’s all the more remarkable given that other retail favourites from bullish stock options to Cathie Wood’s tech fund have all seen activity dip from the highs earlier this year.
Now,cryptomania might even be hurting gold,according to some analysts. The precious metal has suffered outflows in recent months even as a deluge of stimulus cash drove the value of the world’s crypto market to a $US2 trillion ($2.6 trillion) record.