Dogecoin price crash: What is happening to DOGE, why is it crashing? | City & Business | Finance
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The viral, meme-based cryptocurrency Dogecoin has suddenly crashed, dragging the cryptocurrency market down by billions of dollars. Multiple cryptocurrencies have been affected by the crash.
The price of the top five cryptocurrencies by value — ethereum, Binance’s BNB, cardano and Dogecoin — are all down by double-digit percentages in the last 24 hours with around $700 billion now wiped from the cryptocurrency market over the last week.
The market crash follows a decision by Tesla to no longer accept Bitcoin as payment for its vehicles, as announced by the car company’s CEO Elon Musk.
Mr Musk said on Twitter: “Tesla has suspended vehicle purchasing using Bitcoin.
“We are concerned about rapidly increasing use of fossil fuels for Bitcoin mining and transactions, especially coal, which has the worst emissions of any fuel.
“Cryptocurrency is a good idea on many levels and we believe it has a promising future, but this cannot come at a great cost to the environment.
“Tesla will not be selling any Bitcoin and we intend to use it for transactions as soon as mining transitions to more sustainable energy.
“We are also looking at other cryptocurrencies that use <1% of Bitcoin’s energy/transaction.”
Mr Musk has been a long-time advocate of cryptocurrencies and the Tesla decision was felt across the market, with other digital tokens also feeling the hit.
Why has Dogecoin crashed?
Musk’s shock post on Twitter had an immediate impact on Bitcoin’s value, which dropped $6 billion (£4.26b) and sent shockwaves throughout the market.
Ulrik Lykke, executive director at crypto hedge fund ARK36, said: “The crypto markets are currently processing a cascade of news that fuel the bear case for price development.
“When it comes to Elon Musk’s tweets or negative remarks from the People’s Bank Of China, it is important to distinguish their true impact from their perceived impact.
“Realistically, it is not the first time Elon Musk’s tweets have been erratic and, frankly, wrong; likewise, China has changed its stance on cryptocurrencies multiple times before.
“News like this can get a lot of traction and easily stir market sentiments but they often prove of little significance in the long term.
“The crypto markets are extremely emotionally driven and their participants are prone to overreacting to events they perceive as negative.”
The markets took another hit when China said it was going to block initial coin offerings, block exchanges and warned against speculative trading.
It was China’s latest attempt to clamp down on what was a burgeoning digital trading market.
In a joint statement on Tuesday, three industry bodies said that under the ban, such institutions, including banks and online payments channels, must not offer clients any service involving cryptocurrencies, such as registration, trading, clearing and settlement.
The three industry bodies are: the National Internet Finance Association of China, the China Banking Association and the Payment and Clearing Association of China.
What is Dogecoin’s current price?
Dogecoin’s current price is $0.435274.
This is down nearly 11.5 percent.
Mr Musk has frequently advocated for smaller cryptocurrencies like Dogecoin, so it is hoped it will be able to recover.
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