Author: b12ny (X: @b66ny)
Dogecoin has always been seen as the meme coin leader. At the end of 2024, due to the Trump and Musk effect during the US presidential election, the price soared, but then entered a significant correction, with a decline of over 60%, which is consistent with the overall decline in the meme coin sector, indicating that its short-term momentum is dominated by market sentiment.
In terms of institutional layout, Grayscale launched the Dogecoin Trust Fund (with a management fee of 2.5%) in January 2025, which is only open to accredited investors. Although the scale is still small (around $2 million AUM), the significance goes beyond the number itself, as it represents that $Doge has officially entered the range of investable assets for institutions, and is seen as a key step in the transition of Dogecoin from a meme-driven to an institutionally invested asset.
As for ETFs, it is being pushed by Bitwise, which has submitted an application for a $Doge ETF to the SEC. If approved, it may further expand the market liquidity of $Doge. However, there are currently no approved cases, and the future development still needs to be observed in the changing regulatory environment.
$Doge has the potential for short-term speculative value and long-term application scenarios, and its price is highly correlated with Musk in the long run. X is actively exploring the integration of the payment system, and if $Doge is incorporated into the X payment system, this will be the biggest market catalyst since 2021.
The future development direction will depend on three key variables: payment applications, institutional investment, and coin distribution dynamics.
Currently, $Doge is still a speculative asset driven by the community. If X or Tesla expands payment applications, it may bring new market demand. In addition, the progress of ETF applications and regulatory policies will also affect the inflow of institutional capital, further changing the market structure of DOGE. This article will analyze the current positioning and potential opportunities of $Doge through historical review, narrative economics, and in-depth analysis of coin distribution.
Historical Review
$Doge was born in 2013, initially created by Billy Markus and Jackson Palmer to satirize the bubble in the cryptocurrency market, but unexpectedly developed into the global meme coin with the highest market capitalization. The historical development of $Doge can be divided into several major stages:
2013 - 2017: Community-driven and Charitable Culture
The Reddit community drove $Doge to become an internet tipping currency.
In 2014, they sponsored the Jamaican bobsled team to participate in the Winter Olympics.
In 2015, Elon Musk first publicly expressed interest in $Doge.
2018 - 2020: Low Liquidity and Marginalization
$Doge maintained a low price for a long time, without any significant narrative driving the market.
The main liquidity came from community trading, without institutional attention.
2021 - 2022: Elon Musk and the Meme Coin Frenzy
The GME event and Musk's posts drove $Doge, which surged 100-fold in 4 months.
$Doge's market cap once exceeded $90 billion, making it one of the top three cryptocurrencies.
Major trading platforms like Robinhood, Coinbase, Binance, and OKX listed $Doge.
2023 - 2025: Institutional Capital Inflow and Payment Integration
Elon Musk's acquisition of Twitter (now X) drove the sentiment-driven rise of $Doge.
Tesla started accepting $Doge as payment for some products.
Trump's election as US president, with a more crypto-friendly attitude, may drive related policies.
The circulation of X Money code and related information has led to market expectations that it may support crypto payments for $Doge.
Grayscale launched the $Doge trust fund, and Bitwise submitted a $Doge ETF application.
Narrative Economics
The market value of $Doge mainly depends on narrative-driven factors, which determine the future development and liquidity sources of $Doge, and also affect the capital rotation patterns of institutions and retail investors.
The current market narratives are:
Meme coin leader and POW mechanism, Musk effect and $Doge's connection, payment narrative (Tesla, X Money), institutional investment and ETF applications
Meme Coin Leader and POW Mechanism
Meme Coin Leader
Since the birth of $Doge, it was initially driven by the Reddit community to become an internet tipping function. Since the last bull market, it has established itself as the meme coin leader in terms of market capitalization, mainly influenced by Musk. Although it is primarily affected by the overall market trend, it also has long-term correlations with other meme coins, and has catalyzed the birth of other meme coins.
For example, $Shib and $Floki were born in 2021, as well as the then-popular $Babydoge. It is worth mentioning that compared to other "meme tokens" that are compatible/exist on public chains, $Doge is the largest POW "meme coin" (second only to $BTC), with $LTC being the third largest.
POW Mechanism
In the last bull market, you might have heard the phrase "Bitcoin, Litecoin, Dogecoin", as they all have a POW architecture and similar code. The main difference between $Doge and the other two is the inflationary mechanism, with $Doge having a fixed annual issuance of 5 billion coins, while the others have a maximum supply cap. The table below compares the information and mechanisms of the three:
In 2014, when $LTC's hashrate was as high as 600GH/s, $Doge's was less than 40GH/s, making the network attack cost on DOGE very low, leading to pool attacks and Dogecoin Wallet hacking, causing the price to plummet 95.26%. To enhance security, LTC founder Charles Lee suggested that the $Doge community join forces with $LTC for merged mining (AuxPoW), which sparked heated debate, but the community ultimately chose to bind with $LTC.
Through shared computing power, the total network hashrate of $Doge has grown steadily, increasing the cost of hacker attacks on DOGE and ensuring the security of the chain. The $Doge rewards also became the main income source for miners (early $LTC miners were also major $Doge holders), and in retrospect, the merged mining at the time brought a win-win situation.
Musk Effect and $Doge's Correlation
Everyone knows that the 2021 resurgence was largely driven by Musk. Over time, the market influence of $Doge has become increasingly linked to Musk, including his announcement on April 28, 2021 that he would appear on Saturday Night Live (SNL), and the live broadcast on May 8.
During the broadcast, when asked what $Doge is, he jokingly replied: "It's a hustle", causing the price to plummet 30% from $0.74. At the time, Grayscale CEO Barry Silbert even posted that he had shorted $Doge for $1 million on FTX. The irony is that $Doge has now become one of the coins in Grayscale's trust fund, showing a clear change in attitude.
Musk also strongly supported Trump's presidency in this election, and even proposed a government efficiency department (abbreviated as D.O.G.E.) last year, mainly responsible for improving government efficiency and reducing costs. The market initially linked this initiative to $Doge's price, and the official website briefly changed to the $Doge logo in early January.
However, reviewing the past to the present, the overall environment has changed, and the market no longer buys into Musk's simple meme slogans or tweets. The expectation for an increase will be placed on Musk's ability to actually support $Doge through other means.
Payment Narrative (Tesla, X Money)
In 2025, X announced the upcoming launch of the payment service X Money, which is a key step in Musk's plan to transform X into an "All-in-one App". According to the current information, it will include digital wallets, instant transfers, QR code payments, and integration with Visa, and more in-depth system integration is expected to be released in the future.
Here is the English translation of the text, with the specified terms retained and not translated:However, as a trader in Crypto, I am more concerned about whether the expected combination of X Money and $Doge can be implemented, plus the existing Tesla payment method includes $Doge (limited to certain products), where some news media have pointed out that some supercharging stations in the United States also support charging payment.
The following is an interpretation based on the information I currently have:
Tesla
According to @inevitable 360's query of the front-end code, it was found that the code for "DOGECOIN" can be found on the cybertruck page, and during the period of 2022 - 2023, I also found the codes "DOGEPAY" and "DOGECOIN" by querying the front-end code. Subsequently, Musk posted an announcement to officially open the payment function, so this information combined with the payment narrative is very likely to be realized this year to support the option of paying to buy vehicles.
X Money
The information released by @aaronp 613 shows that X plans to launch X money first in the United States. Since X Money has not yet obtained a complete license in all 50 states of the United States, it may choose to go online first in the 39 states that have been approved, through the testing and verification of some states, and also provide each user with a QR code, similar to scanning the code for payment to transfer and remit funds.
Based on my past research experience and interpretation, it was originally in April 2023 that Musk changed the Bluebird logo to the Doge dog logo to fulfill the promise he made in 2022, including the D.O.G.E logo on the website being briefly changed to the dog, I believe Musk will keep his original promise or joke (the Twitter acquisition is also).
At the practical level, if X Money officially supports financial services, X can test the feasibility of the payment service, and then optimize and expand based on market feedback, and regulation will become a topic of hype. Whether X Money can overcome regulatory obstacles may also become a market focus, attracting capital speculation on $Doge, and $Doge can also be one of the universal methods for cross-border payments.
The most well-known is in 2022, when the CEO of Robinhood, the largest $Doge holder address, Vladimir Tenev, wrote that if Dogecoin wants to become a daily payment and transaction asset of the future, it can solve the problem of too low transaction throughput by increasing the block size and reducing the block time. The co-founder of Dogecoin and Musk also expressed support for his views.
Tenev first mentioned that the transaction fee of Dogecoin is already small enough to be a viable electronic cash leader, but he believes that if it is to be more widely adopted, the block size and block time of Dogecoin need to be improved as the main focus. Therefore, if the speed problem can be further reduced (I believe Musk wants to do it is absolutely no problem), coupled with the fact that Tesla has already realized $Doge payment, the scenario of cooperating with the X Money payment application may be greatly expanded to the global market.
Institutional Investment and ETF Applications
Institutional Investment
In addition to Grayscale launching a Dogecoin trust fund (nearly $2 million AUM) this year, which is seen as a key step in the transition of $Doge from a meme to institutional investment, the Dogecoin Foundation is also a core player in promoting and supporting the development of Dogecoin.
The Foundation also announced the establishment of a "Core Development Fund" in early 2023, investing 5 million $Doge (about $360,000) to support the work of Dogecoin core developers. In November 2024, the Foundation issued a fundraising appeal, seeking the support of major sponsors to drive the large-scale adoption of Dogecoin in 2025, with the funds to be used to build a decentralized payment infrastructure called "Dogebox" to assist small and medium-sized enterprises in accepting Dogecoin as a payment method.
Additionally, the members of the Foundation are also worth noting. In 2021, the Foundation was reorganized, with the advisory board members including: Dogecoin co-founder Billy Markus, core developer Max Keller, Ethereum founder V-God, and Musk's long-term partner Jared Birchall, all of whom are well-known influential figures.
ETF Applications
In early February, Bloomberg analysts James Seyffart and Eric Balchunas predicted the approval probability of ETFs for $Sol, $Doge, $Ltc, and $Xrp:
$Doge (75%): As the largest meme coin, Grayscale and Bitwise's 19 b-4 filings have been recognized by the SEC, so the approval probability is relatively high.
For the institutional part, Trump's policies and statements tend to reduce regulation and encourage market development, which also increases the probability of approval for the $Doge ETF. Therefore, the real question is not whether it will be approved, but when it will be approved.
In my opinion, it must be approved by the end of this year, so that the positive effect of the ETF narrative does not diminish due to the diminishing marginal effect. Currently, the number of coin ETFs applying for and submitting may be increasing, so it is necessary to seize the opportunity to get approval before the end of the year, so that the market's price expectations will be higher (from the perspective of liquidity priority and quantity).
If $Doge, as the leading meme coin, is actually approved as scheduled, then its status and probability as a legitimate payment method may increase significantly, which means that Trump's Crypto policy, whether it truly promotes it, will also have a key impact on Musk's development of $Doge payment and the financial market.
Chip Structure
Since the $Doge chips are concentrated in a few addresses, the top 115 holders account for 65.4% of the total circulation, and Robinhood alone, as a single institution, holds 21.06% of the chips. Therefore, in-depth analysis of the impact of these chips on price fluctuations is usually helpful in identifying clues before the market starts and ends, which has been very helpful in my past trading experience. The following table is a comparison of my past compilation of the Top 20 and Robinhood holdings:
According to the analysis in the article "Beyond Musk: The Real Price Drivers of Dogecoin?! Chip Distribution, Price Impact at a Glance! Quickly Grasp the Key Signals Before the Price Surge", by observing the on-chain transfer behavior of the top 20 $Doge holders, especially the smart money addresses, it can be found that the timing of the operations of these large $Doge address holders is highly correlated with the price rise and fall. The following table lists the addresses with higher correlation with the price:
You can refer to the transfer behavior of these addresses to assist in trading strategies of buying at the bottom and selling at the top, as well as the selling pressure caused by large-scale transfers, which often become a reference signal for the short-term market trend. For traders, focusing on the dynamics of these addresses can provide analysis and evaluation of future price trends, although their market behavior shows that the participation of large smart money makes their chip dynamics more complex.
Current Positioning and Potential Opportunities of $Doge
Based on the past price and cycle, it is very likely to form a relative bottom between 0.18 and 0.2 and then break through the historical high again. I have also stated in my previous tweets that I am willing to make a large purchase at 0.18. If I have to give a price forecast, I think the probability of this cycle reaching $1 is the highest, just like the historical significance of $Btc reaching $100,000.
At the current stage, $Doge still depends on market narratives and liquidity, and in the medium to short term, it may still maintain high volatility following the overall market. Assuming that key events such as the approval of X Money and ETF are realized as expected, then $Doge may truly transform from a meme coin to a "payment-type cryptocurrency".
See you on the moon.
