In financial markets, the GameStop has been the biggest story in the past couple of weeks. For crypto, meme-based Dogecoin is showing fascinating growth. GameStop and Dogecoin could be indicative of a shift in market fundamentals.
The common thread in these trends is the coordinated actions of small traders. Crypto gambling seems right at home in the overall market landscape today. GameStop has shown that stock markets and wagering are incredibly similar. Many would want to label crypto games as an unserious industry. If the events of these few weeks are enduring, analysts may need to have a rethink.
Bitcoin gambling games are here to stay. They are an extension of traditional casinos with the convenience of digitization. Old-timers like Bitcoin crash and Baccarat availed in online crypto gambling platforms like BC Game still retain popularity. New gambling games are also carving a niche in the sector. Overall, the best crypto games present remarkable opportunities for gamers.
Pump and Dump Trends
Hedge funds have ruled speculative stock investments for decades. This unchallenged position has often drawn scorn from populist politicians interested in sound-bites. However, it has never seriously come under threat, like it has from GameStop. Redditors started it as a joke, which then morphed into real action.
Imagine a struggling stock, trading at below $30 for long exploding to over $800. GameStop did just that. It wasn’t on account of a decisive invention or sudden popularity of the game. No, it was all down to Redditors purchasing the stock in droves.
This practice is what made many hedge fund billionaires. They were getting played at their own game. Some of them had bet on GameStop stock falling. Instead, thanks to Redditors, it kept rising at a record clip. Imagine the audacity. Tesla CEO Elon Musk posted a meme about this phenomenon on Twitter with the caption “stonks.”
Robinhood, a popular trading app, suspended GameStop stock for a while. The backlash was swift, with some pointing to this as evidence that market rigging is real.
Coordinated price pumping campaigns are now a thing. Cryptocurrencies like XRP and TRX have also seen prices rise in the past week. Volatility is not new to crypto. However, right after XRP facing a lawsuit from The SEC, this rally does not make much sense.
XRP rallied at the start of the week then crashed more than 40 per cent. Still, the platform entered the top five largest cryptocurrencies by market capitalization. A regulatory crackdown had rocked prices, but who knows what is in store.
Gamestop And The DOGECOIN Roll
Dogecoin is arguably the most fascinating trend of all. This coin is the antithesis of a groundbreaking financial product.
Notably, it takes its name and logo from a Shiba Inu meme. Dogecoin launched in 2013 with no supply cap. At the time, Bitcoin had a reputation as an illicit trade facilitator due to the Silk Road Scandal.
Accordingly, Dogecoin founders purposely gave it the hilarity. It has managed to survive, in large part because it is popular with Redditors. Doge surged recently amid the crypto market rally. On January 20 alone, this coin rallied 800 per cent!
From a technical perspective, Dogecoin isn’t very impressive. It relies on the original Bitcoin source code. There are some modifications like faster transaction speeds and no supply cap. Besides that, nothing to see.
However, from a cultural lens, Dogecoin is the bomb. Elon Musk tweets about Dogecoin often, with a tinge of humour. He has unwittingly become its most significant advocate. Such is the power of popular culture.
Dogecoin has become a cultural phenomenon. Notably, its fundamentals as a financial asset are not the most significant aspect. This fact is also applicable to GameStop and Dogecoin.
Owning Dogecoin has become similar to purchasing the latest Nikes, only that you could make money from the investment. It is fun, amusing, and when enough people get in, it can be lucrative.
Dogecoin reveals the cultural aspect of finance in the most profound way. The 800% rally makes sense only from that aspect. A meme-centric boost is not what Finance majors learn in college. It is just the reality of our times. Similarly, GameStop was unexpected for hedge fund billionaires, despite their experience.
Ultimately, things are valuable because of the value society ascribes to them. That is the enduring power of culture. To some people, sports memorabilia and art don’t make sense. However, the fact that many people prize them gives them their inflated value.
These phenomena should change the way experts think of finance. GameStop caused a moment of reckoning through a few days of trading. Bitcoin itself has convinced more institutional investors that it is here for posterity.
Cryptocurrency is fascinating in many ways. The cultural aspect is one of the truly remarkable ones. Initially, it was a fad for people disillusioned with government currencies. With Dogecoin, it is showing its popular and fun side. All related sectors, like crypto casinos, can catch tailwinds from the cultural popularity of digital assets. So now you know the connection behind Gamestop and Dogecoin!