Elon Musk is making headlines after causing the price of Dogecoin to surge to an all-time high. On Sunday, the tech entrepreneur tweeted “Who let the Doge out”, resulting in a 53% rise over the last 24 hours.
Dogecoin’s record value is now 8.2 cents with a market value of $10 billion – making it the 8th biggest cryptocurrency, according to Bloomberg.
🎶 Who let the Doge out 🎶
— Elon Musk (@elonmusk) February 7, 2021
Dogecoin was introduced in 2013 as a joke. Initially, founders Jackson Palmer and Billy Markus wanted to satirize the growth of altcoins by turning the doge internet meme into a cryptocurrency.
Their joke quickly grew in popularity thanks to the practicality of its low price and large supply which could facilitate “efficient micro-tipping content on social media“.
Ongoing volatility, further progress on regulations and continued interest from institutional investors can be expected in 2021 – this according to South African cryptocurrency exchange, Luno.
“Looking back at our predictions from last year – the Bitcoin halving happened without a hitch and the industry matured as institutional investors entered the market,” says Marius Reitz, GM for Luno Africa.
“2020 was a proper stress test with Bitcoin hitting a low of around $5,000 in March and a high of $28,000. The new year is following the same trend with the price already reaching the $40,000 level.”
Here’s a closer look at seven cryptocurrency predictions for 2021:
1. Institutional investors will continue to flock
While the numbers are small relative to traditional markets, institutional investment will continue to grow as the economic implications of Covid-19 become clearer.
2. Adoption will be on the rise
Mainstream adoption will grow in 2021. Major players are increasing their investment and interest in cryptocurrencies. In addition, the retail market is set to pick up on the back of booming crypto assets, greater media attention and easy access for anyone.
3. Libra/Diem to launch
The cryptocurrency project launched loudly in 2019 by Facebook, Libra was relatively quiet in 2020 and made significant changes to its intended offering, including a rebranding to Diem.
This project is driven by some of the biggest companies in the world including Uber, Spotify, PayU and Andreessen Horowitz. As it unfolds, Diem could spark another wave of large companies wanting to get into the game of issuing their own coins.
4. New US administration
Joe Biden’s administration includes Treasury Secretary, Janet Yellen, who is “not a fan of Bitcoin”. Given the amount of institutional money that flooded into crypto and legislation allowing banks to hold Bitcoin on behalf of their clients in 2020, there’s likely to be significant pushback from Wall Street that may make any bearish positions hard to maintain.
5. Maturing regulation
With the crypto space maturing rapidly, regulators globally are accelerating efforts to either embrace or regulate cryptocurrencies
6. Rival blockchain
The first phase of Ethereum 2.0 finally launched on 1 December after years in the making. This is a huge transition for Ethereum, unprecedented in the history of cryptocurrency, which could leave Ethereum in a state of flux for the next two years, possibly opening opportunities for rival blockchains with similar offerings.
7. Cryptocurrency prices
Cryptocurrencies like Bitcoin are still a new alternative asset class and ongoing volatility is expected. A longer-term view shows crypto to be on an upward trajectory even with massive price drops.
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