Price Drops Over 70% Following Reddit-Driven Surge
The price of Dogecoin has come tumbling down after redditors boosted the cryptocurrency around 900% in the span of a little over 24 hours during the week, flocking to the crypto after being locked out from buying shares of GameStop on the Robinhood brokerage app.
Dogecoin dropped below $0.022 Saturday afternoon, after peaking late Thursday night around $0.078—a drop of about 72%.
Trading volume has also dropped significantly, according to CoinMarketCap, which reported Saturday afternoon a 24-hour volume drop of 71%.
Late in the week, volume was at times so high on Robinhood the app issued a warning that buys might not be immediately completed.
Redditors regained the ability to buy GameStop and other meme stocks retail brokers have been short squeezing on Robinhood Friday, before the app again significantly limited buying ability on 50 securities—including some blue chip stocks.
What To Watch For
Dogecoin, which was originally started as a “joke” has been extremely volatile over the past few days after long having a value of less than $0.01. The price dropped around 22% in a 50-minute period Saturday morning. During a 40-minute period Saturday afternoon, the price rose over 23%.
Redditors have made a massive impact on the stock market in the past week, pushing stocks like GameStop, AMC and BlackBerry as part of a short squeeze that has caused some hedge funds to lose billions on their bets the stocks would continue to fall. But Robinhood and some other brokerages limited trading on the popular stocks at points during the week, leading to massive outrage among many who felt the retail traders were being shut out because they were hurting the billionaire hedge funds. Blowback has included class-action lawsuits and a rare show of bipartisan anger in Washington that’s managed to bring many progressives and Trump-backing Republicans together in agreement on an issue.
Other, more popular cryptocurrencies haven’t had nearly as wild of a week. As of Saturday afternoon, Bitcoin was up just over 6.5% on the week while Ethereum was up just over 9.5%.
Billionaire Elon Musk has said in the past Dogecoin is his “fav cryptocurrency” and mentions on his Twitter usually lead to spikes in Dogecoin value. A tweet from Musk on Thursday showing an image of a dog on the cover of a fictional “Dogue” magazine in the style of Vogue led to a 50% price spike in just over an hour after the tweet.