Emotions play a fundamental role in how markets move, especially during bubbles. In a market bubble, when prices are rising quick and fast, everyone feels like a financial markets expert. That’s because everything continuously goes up in value.
It’s no different for cryptocurrencies. In the 2017 bubble, an investment in any cryptocurrency made investors money, regardless of the fundamentals. However, since it popped, utility is taking more center stage in most people’s investment decisions. The era of throwing money at random ICOs and getting 100X is long gone. These changing dynamics are starving most cryptocurrencies of much needed volumes. Like in all other markets, the bubble pop will have its long-term winners. High utility cryptos like Dogecoin (DOGE) could see a sustained growth in volumes and value in the long-run.
Compared to a significant portion of the market, Dogecoin has maintained a level of stability that makes it practical for everyday payments. This stability is a good indicator that there is real usage for Dogecoin, and that it has value that transcends crypto speculation.
This is a big plus because going into 2019, Dogecoin will continue to attract increasingly cautious retail investors, and more of the ever savvy institutional investors. This could see Dogecoin volume and price rise faster in 2019, and also probably take an even higher spot in market cap rankings. It also means that in the next Bull Run, Dogecoin (DOGE) will emerge as one of the biggest gainers, driven by a higher appreciation of its core fundamentals by the market.
To put Dogecoin into a more relatable context, one needs to go back to the Dotcom bubble. At the peak of the bubble, any stock with .com to it was drawing in investors in droves, regardless of whether it had any sustainable use case or not. However, when it popped, investors were more cautious in the tech stocks they were investing in. Utility took center stage, and the result was the concentration of money in a few tech stocks, such as Amazon, which was valued at a trillion dollars some months ago.
Dogecoin could be headed for a similar future. As the crypto hype dies off completely in 2019, utility will take a more prominent role in determining what thrives, and what doesn’t. This places it in a good position for growth, growth that could see it out do its all-time highs, albeit in a longer time frame. What makes Dogecoin (DOGE) so valuable is its actual usage. Dogecoin (DOGE) is one of the few cryptocurrencies whose daily volumes come from real world use i.e. people buying and selling stuff in it. In essence, Dogecoin is not just good at what it does, people do believe in it, and use it for its intended purpose. Over the years, this usage will only grow, backed by an increased awareness of cryptocurrencies all across the world.
As such, if the bear run extends into 2019, and hype dies off completely, Dogecoin (DOGE) could stand to gain big long-term. A consolidation of investment volumes in high utility cryptos may be a disaster for speculative cryptos, but for Dogecoin and a few others, it could be a boost to long-term success.