The coin is known for being kind of a joke, bump and dump schemes and for it´s PR manager Elon Musk. But what is the seriousness of DOGE?
First the cons: For a Crypto it is way centralized, as one wallet holds 27% of the available currency and the top 20 addresses holds 50% of the Market.
For being so cheap the Market can be easily manipulated by a few people with some influence on social media, and even an individual with impressive influence and reach: When Musk said that Doge was “the people´s crypto” prices spiked by 40% in one hour. He had already praised the coin in April 2019, causing a similar effect.
That´s why from time to time we see a massive wave of shill towards Doge, causing a high in the prices; therefore making useful idiots buy the coin, what is followed by the dump.
So is Doge centralized, volatile and easily manipulated?
Lets take a look into the pros.
Some folks have already argued that those huge wallets are only for cold storage and therefore no individual really owns them. If that´s the case, the centralization problem is solved, but we can´t be shure by now.
Doge´s price volatility tends to be decreased by it´s inflationary nature, the coin is designed to increase its suply at a set rate wich is 5 billion per year. But it will not cotinue to grow ad aeternum because there is a pratical limit, allowing us to calculate it´s inflation over time. The suply rate for every decade is of 50 billion, but the inflation rate is +5% per year as shown in the graphic below.
There are 128 billion coins in the market right now, that makes the growth for the next decade at 3% - 4% per year. After that it treds to slow down at 2% - 3%, therefore the inflation rate will trend down.
If we can predict Doge´s growth and inflation it´s easyer to use it as an actual currrency, what partially solves the volatility problem; making the bump and dump schemes way harder.
All things considered, Doge has a great potential of being a largely used and stable coin at the long term. For now i will buy it and hold, while ignoring all the shilling and stonks boys.
