|Minimum Spread: 0.2||Typical Spread: 1.8||Leverage – 400:01:00||Margin: 0.25%|
Doge is the native cryptocurrency of dogecoin, a parody cryptocurrency based on a viral internet meme of a Shiba Inu dog. At first, the crypto project was created purely as a mockery of other cryptocurrency projects launched at the time.
This cryptocurrency is essentially a direct copy of Litecoin’s code and can be used to transfer value over the internet like all other digital assets. Doge was never designed to have any real-world utility beyond a simple blockchain-based payment system; however, it quickly amassed a diehard community of fans who found and developed new use cases.
Understanding the DOGECOIN price
DOGECOIN’s price represents the cryptocurrency’s current value or its market value. It depicts how much the cryptocurrency trades at – or the price agreed upon by a buyer and a seller. If there are more buyers than sellers, the cryptocurrency’s price will climb. If there are more sellers than buyers, the price will drop.
Key Factors to keep in mind while trading DOGECOIN
Supply and Demand
Like all goods and services, the value of cryptocurrency is determined by supply and demand. Cryptocurrency gains when demand rises higher than supply and vice-versa.
Cost of production
New cryptocurrency tokens are produced by a process called mining. This involves using a computer to verify the next block on the blockchain. Verifying the blockchain requires computing power. Participants invest in expensive equipment and electricity to mine cryptocurrency. Higher cost of production, therefore, translates to higher prices.
Availability on exchange
Mainstream cryptocurrencies such as Bitcoin and Ether are traded on multiple exchanges. But smaller tokens may be available only on select exchanges, thus limiting access for some investors. If a cryptocurrency is listed on more exchanges, the number of investors willing and able to buy it is dramatically increased, thus increasing demand.
There are thousands of different cryptocurrencies in existence, with new projects and tokens launching every day. The entry barrier is relatively low for new competitors. If a new competitor gains momentum, it takes value from the existing competition, thus decreasing the incumbent price as the new competitor’s token sees its price move higher.
Cryptocurrency networks rarely abide by a static set of rules. Developers adapt their projects based on the community that uses them. Generally speaking, investors like stable governance.
Regulations and legal requirements
Regulation is required to allow for easier ways to trade cryptocurrency. Products such as ETFs or futures contracts provide more access to cryptocurrency investors, increasing their values. Additionally, regulation could enable investors to take short positions or bet against cryptocurrency’s price using futures or options. This would lead to better price discovery and reduce the volatility of cryptocurrency pricing.
News or unexpected developments influence investor sentiment, although it is hard to quantify their impact. Public opinion has a lot to do with popular media views, and hence, there is strong evidence to suggest that news- good or bad – affects cryptocurrency prices.