TL;DR Breakdown
- Brad Garlinghouse says Doge is not a good crypto coin.
- Says Doge inflationary nature does not fit crypto feature.
- How most of Doge supply are in hands of few investors.
Dogecoin, the most popular memecoin and one of the most impressive in the year, has won the heart of many cryptoers.
While many in the crypto community argue that Doge brings enthusiasm to the market, CEO of Ripple, Brad Garlinghouse doesn’t think it does much good. Garlinghouse said that Dogecoin might not be good for the crypto market.
He specifically put it in the context of using crypto as an inflation hedge. The CEO said that the meme coin’s inflationary nature doesn’t fit well into that picture.
Garlinghouse spoke in a CNBC-moderated panel discussion at the Fintech Abu Dhabi event. He noted at the event that rising inflation is creating “tailwinds” for the entire sector.
He gave an insight into how the labor department reported a 6.2 percent annual inflation for the month of October, and shortly afterward, Bitcoin’s price shot to an all-time high of$69,000.
Garlinghouse questioned how well Doge could use this framework for its own value proposition.
“I’m actually not convinced, somewhat controversially, I guess, that Doge is good for the crypto market,” he said.
“Doge has some inflationary dynamics itself that would make me reluctant to hold it,” Garlinghouse said. Indeed, Dogecoin does not actually have a fixed supply the way Bitcoin does, giving it a weak argument for long-term use as an inflation hedge asset.
Dogecoin was launched in 2013 and developed in hours, according to its creator. It was created as a joke which emanated from a popular internet meme.
However, since then, it now ranks as the 10th largest cryptocurrency by market cap. Doge helped Shiba-Inu, another memecoin, to rise after capitalizing on Doge’s success.
Other reason Dogecoin is bad investment
One reason many skeptics continue to bash Dogecoin for is the one whale who is said to own 28 percent of all Dogecoin in existence, as reported by The Wall Street Journal.
Speculations about who the investor is continue to mount. However, the person remains anonymous. Likewise, 70 percent of the total Dogecoin supply is held in just 100 wallets making its price easily controllable by some set of people.
It means that Elon Musk is not the only person who can have an outsized impact on Dogecoin’s price. The unknown whale can influence the price of Doge in either direction. Whales have the power to make big alterations in the market and easily sweep little investors aside.
