Here’s what happened with Dogecoin in April

Elon Musk’s entry into Twitter looks to have helped support the Shiba Inu themed token.

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Key points

  • Dogecoin saw plenty of ups and down in April 
  • Elon Musk's entry into Twitter was largely seen as positive for Dogecoin 
  • Cryptos continue to face headwinds from rising interest rate expectations 

Dogecoin (CRYPTO: DOGE), which features a Shiba Inu dog on its logo, started life as somewhat of a joke.

But with a current market cap of US$17.5 billion, ranking it as the number 12 crypto in virtual circulation, this crypto is worth more than many ASX blue-chips.

Here’s what happened with the token in April

Headwinds and tailwinds for Dogecoin

The biggest headwind hitting Dogecoin, and indeed most every crypto, in April was investors’ expectations of significant interest rate rises.

This saw investors shift out of risk assets like crypto and tech shares. And it saw the tech-heavy Nasdaq close down 14% in April while Bitcoin (CRYPTO: BTC) lost 17% over the month.

Dogecoin fared a good bit better, supported in part by Tesla Motors (NASDAQ: TSLA) boss Elon Musk’s foray into Twitter (NYSE: TWTR).

The token traded more than 9% higher on 6 April following news that Musk had taken a large stake in Twitter.

Musk, as you may know, is a big supporter of Dogecoin. And the crypto leapt another 7% on 11 April when Musk said people should be able to use Dogecoin to pay for their Twitter Blue premium subscription services.

For the moment, as CoinMarketCap notes, Dogecoin can be “used primarily as a tipping system on Reddit and Twitter to reward the creation or sharing of quality content”.

At the end of the month…

At the end of the month, the headwinds and tailwinds essentially cancelled themselves out, with Dogecoin finishing April right where it started, at 13.5 US cents.

Not that there weren’t plenty of opportunities to make or lose money. The token traded for as high as 17.8 US cents in April and hit lows of 12.4 US cents.

Dogecoin hit all time highs of 73.8 US cents almost 1-year ago, on 8 May 2021. It’s down 82% since that high watermark.

The Motley Fool Australia's parent company Motley Fool Holdings Inc. has positions in and has recommended Bitcoin, Tesla, and Twitter. The Motley Fool Australia owns and has recommended Bitcoin. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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