In 2013, Jackson Palmer and Billy Markus decided to create an open-source cryptocurrency known as Dogecoin as a joke. It was based on a popular meme that displayed a Shiba Inu breed dog. In recent months, Tesla CEO Elon Musk tweeted about Dogecoin which drove its value up temporarily at points. From being worth under a penny to reaching a value close to $0.08 per coin, its meteoric jumps in price undoubtedly made some of its early adopters very rich. Even though its price has dropped to around $0.05 per coin as of this writing, it continues to attract widespread attention.
What is very interesting about Dogecoin is its utility versus being another store of value like other crypto coins. When Bitcoin first emerged, it was frequently used as a replacement for sovereign currency to make purchases. Over time, as its value increased significantly, many Bitcoin fans began to HODL (Hold On for Dear Life). Instead of spending their Bitcoin, they held onto it for long term to benefit from its increasing value. Other digital coins that have increased in value, such as Ether, have similarly seen a rise in holding behavior. Sure, there are many people spending their crypto on different things like artwork NFTs (Non-Fungible Tokens), but the trend has generally shifted to holding.
This shifting dynamic brings into question the future of crypto in terms of its transactional utility. If most people will buy and hold crypto long term, then it will be more challenging to envision a future where there is a mass adoption of crypto for transactions. The recent introduction of stablecoins, which are digital coins pegged to the value of fiat currencies, has attempted to address these concerns. Since stablecoins generally remain stable in their value, there is less hesitance to spend them, with little risk of losing out on potentially increasing values.
Perhaps another way this challenge will be overcome will be with the use of generally lower value digital coins which have the least potential for meteoric growth. Dogecoin is a perfect example. Despite its substantial spikes in value, it still generally trades at pennies in value. As its popularity has grown, it is conceivable that more people feel drawn to buy it for its fun and humorous origins and won’t feel bad about spending it when needed. This logic seems to have been adopted by Mark Cuban.
Cuban is a successful businessman, celebrity star of the television show Shark Tank, and owner of the professional basketball team, the Dallas Mavericks. He is also known to be pro-crypto and was supportive of the Wall Street Bets Reddit community during the GameStop trading frenzy and its downturn due to trading limits by some brokers. His team, the Mavericks, just announced that they will begin accepting Dogecoin (symbol: DOGE) as payment for tickets and merchandise. It seems Dogecoin is no laughing matter (or at least less of one).
Leading crypto payment processor, BitPay, will be processing DOGE payments for the Mavericks.
According to Stephen Pair, CEO of BitPay, “The Dallas Mavericks are a long-time enthusiast of cryptocurrency, opening up new opportunities for the team to sell tickets and merchandise to its global MFFL (Mavericks Fans for Life) fan base.” He continued, “BitPay believes that with continued cryptocurrency adoption, the industry is reaching an inflection point that will forever change consumer confidence, trust and pave the way for blockchain payments to disrupt the way consumers and businesses receive and spend funds.”
This is encouraging news for the broadening utility of crypto beyond storing value. META 1 Coin serves as a store of value and it can be converted for payments as well. With a series of smart contracts that facilitate stable growth, gold-backed META 1 Coin will potentially benefit from trends toward spending crypto as well as storing it.