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…