Dogecoin (DOGE -4.86%) has been on a remarkable journey since its launch in 2013. Initially created as a joke token, Dogecoin has experienced impressive growth and established itself as one of the most popular cryptocurrencies in circulation today. Its rise to fame has been attributed to not only its dog-inspired meme status in the community, but also its low fee structure, fast transaction times, and wide acceptance among merchants.
With these advantages, many may wonder if Dogecoin can reach $1 in 2023.
There's some historical precedent to suggest it's possible
After hitting an all-time high of $0.682 per token on May 8, 2021, it's been mostly downhill for this Shiba Inu-inspired meme token. As of Feb. 6, Dogecoin trades just above $0.09, having lost more than 85% of its value from its peak.
However, considering the fact that Dogecoin previously broke through the $0.60 barrier, and the fact that a $1-per-token price would translate into a market capitalization of roughly $132.7 billion, it's entirely feasible that such value could be attained -- should another 2021-like rally be in the cards. Both Bitcoin and Ethereum trade above this market cap, suggesting such a move is mathematically possible.
But possible and probable are two different things. As mentioned, the ability for Dogecoin to really head to the moon from here depends on whether the macro environment feels the same sort of animal spirits which drove these tokens on an incredible run in 2021. Such a surge is also contingent on whether this project can create any significant value for users -- or at least tell a better story around future upgrades for the network.
New partnerships, major investments, and new applications on the Dogecoin network could determine a great deal of value. It's been a rocky few years in this space, to say the least.
The road ahead
Given how difficult it is to predict what may happen tomorrow -- never mind next week, quarter, or year -- one can't say with 100% accuracy whether a meme token like Dogecoin will breach a level it's never hit before.
But, one of the key catalysts that many agree is required for Dogecoin to hit that $1 mark is for the network to continue to gain acceptance among merchants and investors as a potential payment network.
One of Dogecoin's biggest and most vocal supporters, Elon Musk, recently announced that social media platform Twitter will be looking to transform into a payments platform. Given his explicit support of Dogecoin, many supporters immediately began posing the idea of what would happen in a world where all Twitter payments take place via Dogecoin.
That's interesting to consider. If Dogecoin can garner significant traction via Twitter or another key corporate partner, perhaps it's game on with respect to this rally. While most of the catalysts driving Dogecoin higher this year appear to be of the speculative variety, there may be a bit of fire where there's smoke here.
Is $1 in the cards for Dogecoin?
Dogecoin has experienced incredible growth since its launch and established itself as a top 10 cryptocurrency. Few saw that coming a few years ago. Thus, with the network's valuable and highly engaged community, it's mathematically possible for a surge to $1 per token to materialize in 2023.
With that said, I think it will take some sort of major catalyst to push Dogecoin over this major threshold. A $132.7 billion valuation is incredible for a network of digital tokens that doesn't really do anything. To put this in perspective, if Dogecoin were to trade at this valuation today, it would be the 55th most valuable company in the U.S., worth more than American Express and just below ConocoPhillips.
Thus I'm going to put the probability of such a move in the "unlikely" category. As investors have seen in the crypto world, almost anything's possible. But I just don't see such a move happening unless something truly remarkable happens with this network in very short order.
