Crypto Mania Sends Doge Soaring, Crashes Robinhood Token Trading
Investors are pushing their way back to some of the fringes of the cryptocurrency world, with the madness sending Dogecoin up more than 50% again and crashing Robinhood's trading app.
Other so-called altcoins also kicked off, with Dash gaining 18% and Ethereum Classic gaining nearly 45% within 24 hours on Wednesday morning. In the world of DeFi, tokens like Force DAO and Tierion rose more than 1,000% on Tuesday, according to CoinMarketCap.com data. Meanwhile, Robinhood announced it had resolved previous crypto trading issues on its platform.
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"You have money looking to own a home and this is one of the areas of the market where speculation takes place and there is significant appreciation in a short period of time," said Chad Oviatt, director of investment management at Huntington Private Bank. "You get that fuss over there."
The rallies were difficult to explain and continued a trend that saw the value of all digital tokens surpass $ 2.3 trillion. Doge, created as a joke in 2013, was used for marketing gimmicks - the latest from the Oakland A baseball team, which this week offered two slots for games for 100 Dogecoin. The Gemini crypto exchange, backed by Tyler and Cameron Winklevoss, said it now supports Doge and will soon enable it to be traded.
Dogecoin’s scorching advance of around 0.002 cents a year ago - when it was valued at around $ 300 million - has piqued the interest of many on Wall Street. It even caught the attention of the Federal Reserve - the central bank chairman replied "some asset prices are high" last week when asked if things like the supercharged GameStop Corp. rallies. and Dogecoin endanger financial stability.
As a sign of the increasing popularity of Dogecoin, the Robinhood app is one of the top 10 downloads in the Apple App Store. Coinbase Global, the largest U.S. crypto exchange that doesn't offer doge trading, posted a 4.6% drop in price on Tuesday. This was the lowest closing price since it debuted last month.
"It's pretty amazing that something that started as a joke has gotten so popular," said Matt Maley, chief marketing strategist at Miller Tobacco + Co.
Although interest in digital assets has increased in recent months as more traditional companies that have long hesitated to warm up the crypto space on cryptocurrencies, alternative coins have drawn the most attention in the past few days. Bitcoin has receded into the background after record-breaking Ether and Doge rallies, wrote Edward Moya, senior market analyst at Oanda.
"The Dogecoin bubble should have burst by now, but institutional interest is trying to capitalize on that momentum and this could support further spike," he said in a note. "Dogecoin is on the rise because many cryptocurrency traders don't want to miss the buzz that has come from Elon Musk's hosting of Saturday Night Live."
Elsewhere, a new Ether ETF trade in Canada, the CI Galaxy Ethereum ETF (ETHX), broke its record volume on Tuesday. It was up more than 20% for the first two days of the week.
Bitcoin rose slightly on Wednesday and lost for three days. It rose 0.8% to $ 55,213 at 9:29 a.m. in London on Wednesday.
Meanwhile, many - including famous crypto investor Mike Novogratz - have warned that the rallies may not be sustainable. Novogratz, CEO of Galaxy Digital Holdings, recently said he was "very, very concerned" if any of his friends invested in Doge.
"It seems like investors are moving from one hot spot to another like a pinball game," said Mike Bailey, research director at FBB Capital Partners. “In my opinion, this speculative wave will suffer the same fate as GME and other Robinhood flash-in-the-pan stocks. Cryptocurrencies, like precious metals, may have become a new asset class, but such fluctuations do not appear to be sustainable. "
(Updated prices throughout.)
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