Even with Elon Musk by his side, I still avoid Dogecoin

Even with Elon Musk by his side, I still avoid Dogecoin - 106881294 1620749189576 gettyimages 1232802276 Dogecoin scaledIn 2023, Dogecoin (quotation DOGE) soared 32,73% amid a broader cryptocurrency market rally. Dogecoin's rapid rise in January appears to be driven primarily by rampant investor speculation that billionaire Elon Musk will continue to back the coin, especially through his $44 billion takeover of Twitter.

Recently, Elon Musk doubled down on his famous Happy Meal challenge, saying, "I will eat a Happy Meal on TV if McDonald's accepts Dogecoin." This has delighted longtime Dogecoin investors and enthusiasts. With Musk backing Dogecoin, logic dictates that the meme coin is unstoppable. But how accurate is this logic?

Elon Musk and the Happy Meal challenge

In many ways, the Happy Meal challenge, which was first launched almost exactly a year ago, perfectly epitomizes the meme coin phenomenon. You get a famous celebrity to express support or admiration for a particular coin, you use it as a marketing or publicity stunt to generate buzz and awareness, and you watch the coin go to the moon based on speculation and hype alone .

Yes, if McDonald's accepts Dogecoin, that could be a great deal. But as we saw in 2022, the chances of that happening are slim to none. When Musk first launched the Happy Meal challenge, McDonald's response via Twitter was joking but dismissive: "Only if Tesla accepts the Grimacecoin." The tweet included an image of Ronald McDonald's best friend Grimace's round purple character on a coin. The message was clear: “If you want us to accept your meme coin for our burgers, then let our customers pay for your Tesla cars with our meme coin.”

Will Dogecoin ever integrate with Twitter?

If a promotional tweet from Musk isn't enough to move the price of Dogecoin, there's still a chance that a Dogecoin integration with Twitter as a payment option could shake things up, right? Again, you'd be disappointed. Take, for example, the new Twitter Coins project, which Twitter is promoting as a way to reward content creators. As investors discovered this month, Twitter Coins does not involve the use of Dogecoin. Instead, Twitter will use Stripe as a payment provider.

Or, for example, take Musk's recent announcement that Twitter will soon roll out a new payment feature for things like subscriptions and purchases made through the social media platform. For months, there was speculation that this payment feature would highlight Dogecoin. But, as Musk himself pointed out, the main focus for now will be fiat currencies, not cryptocurrencies. So even if Twitter decides to integrate Dogecoin at some point, it won't happen anytime soon.

Is there a real catalyst for Dogecoin?

Right now, Dogecoin needs more than just backing from Musk. He needs a better roadmap for the future. As it stands, Dogecoin is doing little to build utility and value. Plans to convert from a proof-of-work blockchain to a proof-of-stake blockchain have apparently been shelved. Furthermore, there are no immediate plans to make the Dogecoin blockchain compatible with smart contracts, which means that Dogecoin can never get involved in some of the most promising areas of the cryptocurrency world, such as non-fungible tokens (NFTs) and finance. decentralized (DeFi).

As a result, I'm not convinced there is enough to boost Dogecoin's long-term value, especially when compared to what other meme coins, like Shiba Inu, are doing to boost value. Shiba Inu, for example, is preparing to launch a Layer 2 scaling solution called Shibarium. Additionally, it is working overtime with new coin burn initiatives to remove millions of Shiba Inu coins from circulation.

For this reason, I still avoid Dogecoin. Given my enormous respect for Musk, I am willing to change my mind in the future, but for now I am very skeptical of Dogecoin. I see no fundamental catalyst for the value of this meme coin to increase.