Why Dogecoin Was Climbing Today

What happened

Dogecoin (CRYPTO:DOGE), the Shiba Inu-themed cryptocurrency, was climbing today, outpacing Bitcoin and Ethereum as Dogecoin bulls took advantage of the recent sell-off. 

The crypto coin’s price spiked overnight on heavy volume, potentially indicating a large purchase in China, as a significant portion of Dogecoin mining is done there and much of the currency is owned by just a few “whales,” or major players who control the market.

As of 11:05 a.m. EDT, Dogecoin was up 5.5{8a924211cc822977802140fcd9ee67aa8e3c0868cac8d22acbf0be98ed6534bd} over the last 24 hours in its highest-volume trading day since June.

Image source: Getty Images.

So what

There was no major news pushing Dogecoin higher today. However, a couple of recent items point to reasons to be bullish about the cryptocurrency. 

First, U.S. Congressman Barry Moore, from Alabama, declared investments in several cryptocurrencies yesterday, including Dogecoin. While that news shouldn’t have any direct impact on legislation on cryptocurrency, it shows that Dogecoin owners are widespread. Moore purchased between $1,001 and $15,000 of Dogecoin on June 13 and also bought Ethereum and Cardano.  

Another report that had Dogecoin bulls excited was Visa‘s announcement Wednesday that transactions on crypto-linked Visa cards totaled more than $1 billion in the first half of the year. The credit card giant also said that it would partner with the top 50 cryptocurrency platforms to launch card programs that make it easy to convert and spend digital currency at 70 million merchants worldwide.  

That announcement certainly looks like good news for proponents of Dogecoin, who are trying to gain increased acceptance for the currency with merchants. 

Now what

Cryptocurrencies tend to trade on speculation, fleeting news items, emotions, and technicals, and that is especially true with Dogecoin, which is not considered to be the check on inflation that Bitcoin is, nor is it widely used in transactions for NFTs and other such items, as Ethereum is.

Still, Dogecoin has clearly found an audience, and the more interest there is in the token, the more likely it is that it will gain real-world utility and scale. A congressman’s buying the coin and Visa’s increasing push into crypto are certainly favorable developments for Dogecoin’s future. 

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium advisory service. We’re motley! Questioning an investing thesis — even one of our own — helps us all think critically about investing and make decisions that help us become smarter, happier, and richer.

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