Dogecoin (DOGE) drew attention during the 2021 bull market after billionaire Elon Musk began to post about it on his Twitter account, leading to a tremendous rally. However, the meme coin has since declined significantly and is currently trading at 90% lower than its May 2021 all-time high. Consequently, the question at hand is whether DOGE can reclaim its former glory.
Will Dogecoin Ever Reach $0.7 Again?
Dogecoin is still standing strong as one of the largest cryptocurrencies around, but it has an important factor to consider in its tokenomics. Unlike Bitcoin whose supply is limited to 21 million or Ethereum which has implemented a burn mechanism to reduce the supply, Dogecoin has no such regulations. As a result, its total supply is ever increasing, reaching 5 billion coins every year. This translates to an annual inflation rate of 4%, a high figure and one with no prospect of reducing.
The meme coin is driven by hype, and less by tokenomics, as seen by the success of Shiba Inu with its massive supply. This means that the price of DOGE will be based on the sentiment of the community, rather than the tokenomics.
DOGE trending at $0.0757 | Source: DOGEUSD on TradingView.com
The chances of DOGE reclaiming $0.7 remain high, given that it still receives support from Elon Musk during the bear market. Burger King, one of the largest fast-food chains in the world, has also recently shown its support for the digital asset, leading to a price surge.
Assessing The Performance Of DOGE
Dogecoin’s price has been following the performance of the overall crypto market. Like most coins, it has seen a significant drop from its 2021 all-time high values and is closely tracking Bitcoin’s price movements. This means that when bitcoin rallies again, DOGE is likely to follow suit.
Looking at its monthly performance, DOGE saw some gains in the middle of March, but the bear market has since reversed those gains, leaving the coin in the red. As of now, DOGE is trading at $0.0843, with 0.88% losses in the last week. This makes it one of the worst performing large caps in that period.
