The mystery of Dogecoin's price: From joke to an astonishing leap to the 10th largest market cap

The trajectory of Dogecoin (DOGE), the most unique entity in the cryptocurrency market, is not just a history of investment but a story of the fusion of internet culture and blockchain technology. Starting from a cute Shiba Inu logo, why did this project grow to a market capitalization of 2.39 trillion yen? The secret lies in the power of the community, support from celebrities, and surprisingly practical technical design.

From Birth to Market Position

The Dogecoin story began in December 2013 as a simple satire by software engineers Billy Markus and Jackson Palmer. At that time, the cryptocurrency industry was flooded with projects claiming to be “the next Bitcoin,” but the two launched Dogecoin as a “fun and casual coin” based on internet culture.

The iconic Shiba Inu logo originated from a photo of a beloved Japanese dog named “Kabosu,” which spread online and became popular as a meme due to its unique expression. This meme, called “Doge,” quickly spread in English-speaking countries as an image decorated with Comic Sans font. Although initially not taken seriously, the strong reaction from internet users led to the rapid formation of a community, making Dogecoin the pioneer of the “meme coin” category.

Technical Advantages Based on Litecoin

Dogecoin was developed by forking the Litecoin (LTC) code and adopts the same Proof of Work (PoW) consensus algorithm as Bitcoin. However, instead of Bitcoin’s SHA-256, it uses Scrypt, making mining more accessible with general-purpose computers.

This technical choice is Dogecoin’s greatest strength. The blockchain processing speed has been significantly increased:

• Bitcoin: approximately 10 minutes per block
• Litecoin: approximately 2 minutes 30 seconds per block
• Dogecoin: approximately 1 minute per block

Furthermore, transaction fees are extremely low, around a few yen, compared to thousands of yen during Bitcoin congestion. This advantage makes Dogecoin ideal for frequent small transactions such as tipping on social media and in-game currency.

Unlimited Supply Design and Inflationary Characteristics

One of Dogecoin’s most distinctive features is its unlimited issuance. Unlike Bitcoin (21 million coins) and Litecoin (84 million coins), about 5 billion coins are newly issued each year. This design results in:

1. Positioning as a circulation currency: Encouraging “use” rather than “holding for scarcity.”
2. Perpetual mining rewards: No issuance cap means rewards to miners are secured long-term.
3. Long-term decrease in scarcity: As supply increases, the value per coin depends on supply and demand balance.

This characteristic shows that Dogecoin is a currency that emphasizes actual circulation and usage, unlike Bitcoin, which seeks scarcity as “digital gold.”

Dramatic Price Fluctuations: The Mask Effect and Market Correlation

Dogecoin’s price has shown extremely dramatic fluctuations. From 2013 to late 2020, it traded below 1 yen per DOGE, but in 2021, the situation changed dramatically.

Between January and May 2021, the price increased over 100 times in just four months, reaching about 69 yen (all-time high) on May 8, 2021. Several factors drove this surge:

Background of the 2021 Rally

• Capital inflows into the entire crypto market due to global monetary easing policies amid COVID-19
• Rising recognition of the crypto ecosystem’s value driven by the DeFi boom
• Rapid community expansion on social media platforms like Reddit
• Accelerated entry of retail investors

A notable influence was Elon Musk, CEO of Tesla. His tweets such as “Dogecoin might be my fav cryptocurrency” in April 2021, and his appearance on “Saturday Night Live” in May (just before a sharp rise, then a drop after calling it “a scam” during the show) significantly impacted the market.

From late 2021 to 2022, the price declined, reaching about 6 yen in June 2022, affected by the overall correction in the crypto market and concerns over tightening monetary policy.

Turning Point in 2025: Expectations for ETF Approval and New Developments

Recent price recovery has been supported by several positive factors:

• The approval of Bitcoin spot ETFs in the US in January 2024, boosting the entire market
• The election of Donald Trump in the US presidential election in November 2024 (with a crypto-friendly stance)
• Applications for Dogecoin spot ETFs by multiple asset management firms such as Grayscale, Bitwise, and 21Shares (from January to April 2025)

On February 27, 2025, the SEC clarified that meme coins like Dogecoin are classified as “collectibles” and are under the jurisdiction of the CFTC (Commodity Futures Trading Commission), not securities. This decision significantly reduces regulatory risks and clarifies the path toward ETF approval.

However, the SEC has previously pointed out “price manipulation risks,” and Dogecoin, whose price is heavily influenced by individual statements, may face stricter scrutiny.

Market Situation in 2025

From February 2025 onward, due to incidents like the Bybit hacking and concerns over US economic policies, the market entered a correction phase, and Dogecoin also declined. As of January 9, 2026, the price is around $0.14 (about 18 yen), well below the peak of 69 yen in 2021.

Practical Adoption: From Tesla to AMC

Dogecoin is increasingly being used not just as a speculative asset but as a practical payment method.

Tesla, led by Elon Musk, allows the purchase of related goods with Dogecoin, not just electric vehicles. SpaceX has also started accepting Dogecoin for space-related services since 2022.

Luxury fashion brand Gucci introduced multiple cryptocurrency payment options at some US stores in 2022. Online gaming company NEXON has integrated Dogecoin payments in some titles.

Notably, the Dallas Mavericks basketball team accepts Dogecoin for tickets and merchandise, Microsoft has started accepting Dogecoin for Microsoft 365, gaming, and hardware payments, and AMC, the largest movie theater chain in the US, is enabling Dogecoin payments for tickets, concessions, and merchandise. The adoption of Dogecoin in everyday consumption scenes is rapidly expanding.

Technology Roadmap by the Dogecoin Foundation

Reformed in August 2021, the Dogecoin Foundation supports long-term development with advisors including Ethereum co-founder Vitalik Buterin and representatives of Elon Musk. The announced “Dogecoin Trailmap” includes key projects:

• GigaWallet: API solution for companies to easily integrate Dogecoin
• Libdogecoin: Library for easy implementation across platforms
• RadioDoge: System combining Starlink and wireless nodes for remote areas
• Community Staking: Considering the introduction of Proof of Stake elements

Particularly notable is the “Community Staking” proposal. Transitioning from current Proof of Work (mining) to Proof of Stake (staking) could reduce energy consumption, strengthen network security, and address sustainability issues.

By 2025, flagship projects like Dogebox and House of Doge aim to provide Dogecoin payment layers to the “first 1 million grassroots retailers,” with a reserve of 10 million DOGE for corporate adoption support.

Dogecoin vs. Shiba Inu Coin: Same Dog, Different Paths

Dogecoin and Shiba Inu Coin (SHIB) are both meme coins featuring Shiba Inu dogs, but their technical backgrounds differ significantly.

Dogecoin, launched in 2013, is a pioneer meme coin with its own Litecoin-based blockchain. It has no issuance cap and emphasizes practical use as a payment method.

In contrast, Shiba Inu Coin, launched in August 2020, is an ERC-20 token on Ethereum. It has an issuance limit of 1 quadrillion coins and explores broad use cases such as building a DeFi ecosystem.

Transaction speeds also differ: Dogecoin processes a block approximately every 1 minute, while Shiba Inu’s speed depends on Ethereum’s network conditions. Transaction fees for Dogecoin are a few yen, whereas Shiba Inu’s fees fluctuate with Ethereum’s gas prices and can be high.

In market cap rankings, Dogecoin ranks 10th among all cryptocurrencies and is the top meme coin, while Shiba Inu is lower in the rankings. The long history and broad recognition give Dogecoin a competitive advantage.

The Future of Dogecoin: A Balance of Supply and Demand

The 2030 price forecast for Dogecoin varies widely from $0.26 (about 37 yen) to $1.03 (about 147 yen). Key factors influencing its future include:

Upside Factors

• Growth of the overall crypto market and institutional investment (ETF approvals)
• Expansion of use as a payment method increasing demand
• Technological evolution and practical improvements based on the trailmap
• Clarification of regulations (SEC and CFTC classifications)

Downside Factors

• Long-term inflationary pressure due to unlimited supply
• Dependence on individual figures like Elon Musk (market manipulation concerns)
• Increasing competition from other meme coins and difficulty in differentiation

Dogecoin has established a unique position as a “fun and usable cryptocurrency,” suitable for fast, low-cost online small payments. However, investors should be aware of the long-term decline in scarcity caused by unlimited supply and the influence of key individuals.

The long-term growth after 2025 will heavily depend on the progress of spot ETF approvals, technological development by the Dogecoin Foundation, and broader real-world adoption. Its success as a practical payment method, beyond meme popularity, is crucial for sustained value appreciation.

Accompanied by the rallying cry “To the moon!,” whether Dogecoin can continue to maintain its presence in the crypto market depends on balancing technological innovation and actual market demand.