In recent weeks, it has been hard to get through a day without running into a headline, or 50, referencing Dogecoin (DOGE). The meme cryptocurrency has seen its price appreciate exponentially on the heels of a series of celebrity endorsements, including billionaire Mark Cuban, Kiss member Gene Simmons and entertainment icon Snoop Dogg.
It is easy to dismiss what is going on with DOGE amid another round of hype-fueled frenzy — like the ones seen before — especially with “The Dogefather” Elon Musk workshopping ideas ahead of his Saturday Night Live hosting gig on May 8.
However, this time, something never before seen is happening: The use of Dogecoin for payments has been ramping up along with the coin’s price. In addition to the National Basketball Association’s Dallas Mavericks, a team owned by Dogecoin proponent Mark Cuban, Major League Baseball franchises are now also getting into the DOGE game. But is the growth of DOGE payments sustainable outside of hype cycles?
Much likable medium of exchange
Money can be a tool for coordinating human activity. To take on this role, the asset used as a medium of exchange must command the positive sentiment of a large enough audience. This favorable attitude can stem from a long-entrenched convention (as in the case of fiat), technological soundness (like a token designed to facilitate monetary transactions on a blockchain), or simply the fact that people like it or think it is easy and funny.
Dogecoin lacks technological robustness; it hasn’t seen a significant software update in many years. Until recently, the asset’s practical usage was mainly confined to tipping people on forums for witty remarks.
Yet, it is not unthinkable that the combination of Dogecoin’s memetic power — something it has demonstrated on multiple occasions in the past — plus the fading boundaries between collective sentiment and collective action, could mean more for adoption as a payment tool than for a sound reputation or technological superiority.
Granted, the chief motivation for businesses to start accepting DOGE payments at this time is likely the ticket to the hype train that making such a move confers. In addition to viral fame, a brand can benefit from the support of a vibrant Dogecoin crowd interested in boosting businesses that are shilling their bags on social media — a relationship some observers label as “mutually parasitic.” But it is anyone’s guess what will happen when a critical mass of businesses decide to take this route.
Very zoomer money?
Analysts often cite Dogecoin’s popularity with younger internet users as the rocket fuel that can eventually take it to all kinds of incredible places. In a recent interview, Ran Neuner, co-founder and CEO of blockchain investment firm Onchain Capital, suggested that young TikTok users could generate sufficient network effects to make DOGE a viable tool for online transactions.
It is difficult to estimate how popular Dogecoin is with teenagers and young adults. Indeed, it is a compelling idea that the coin that started as a joke and now has a $77-billion market capitalization embodies the nihilistic spirit of the younger generation. It is also true that last summer’s price pump began on TikTok.
Yet, when it comes to the question of how many zoomers — members of Generation Z — are using DOGE, the most honest answer is that there is no way of knowing. Reliable survey data on crypto usage is hard to come by, doubly true for age-group-specific data. According to the latest iteration of investment bank Piper Sandler’s “Taking Stock With Teens” survey, 9% of teenagers in the United States reported having traded cryptocurrencies. While the almost one-in-ten statistic looks solid, there are no details on which assets the respondents have traded.
Another recent survey by financial group Charles Schwab measured cryptocurrency trading behavior among young adults in the United Kingdom. It found that more than half of British investors…
Read More: cointelegraph.com