Helped by the listing on Coinbase Pro, the price of Dogecoin is back in the green at $0.39 (+20%). Enough to spark buying desires?
The most volatile of cryptocurrencies is back in favor. According to Coinmarketcap, the price of DOGE is up 20% in the last 24 hours. It is now back up to $0.39. And it needed it.
Over the last 7 days, Dogecoin is up a more modest 8.70%. Nevertheless, within the Top 10 cryptocurrencies, the coin meme stands out, as it often has in the past. Apart from Uniswap’s UNI, it is the only token that has grown over 7 days.
All other cryptocurrencies are in the red, although the declines remain moderate compared to previous weeks. The explanation for DOGE’s renewed form is not to be found far away.
The trigger for the price increase is Coinbase. The American exchange will offer it for trading on Coinbase Pro starting Thursday, June 3. The announcement is not new. It is a confirmation.
At the beginning of May, the crypto exchange expected 6 to 8 weeks before the integration of Dogecoin. The process will have ended up being faster. And as is often the case, the Coinbase effect on crypto prices is showing.
A study from last April measured this effect. Several tokens have already benefited from it. This is the case of Cardano, ankr (ANKR), curve DAO (CRV) and storj (STORJ). Filecoin (FIL) saw its value increase sixfold after its listing on Coinbase in December 2020.
Can Dogecoin expect a comparable performance? It’s impossible to say. The Coinbase effect is real, but its magnitude is very disparate from token to token. “Coinbase listings have the highest average return, at 91%, but they also have the widest distribution, ranging from -32% to 645%,” the study’s author observed.
One reason for this is “outliers,” i.e., cryptos soaring after their listing. They then show “considerable returns after the announcement of their listing. “
“Among these outliers, District0x (a platform for creating decentralized marketplaces and communities) and Civic (an identity verification solution) saw their prices rise by 645% and 493% respectively,” the report cited.
Dogecoin no longer has the surprise factor though. The value is already widely known among investors, including for its high volatility. It is unlikely that its rise will rank as an outlier in the future.