Elon Musk, CEO of Tesla, thinks that the main problem with Dogecoin is its concentration in just a few hands.
Tesla CEO Elon Musk is once again a highlight across crypto media thanks to a tweet about Dogecoin. A tweet that also sends direct advice and that somewhat reveals his thoughts about cryptocurrencies not being at the hands of just a few. Musk says that if the Dogecoin distribution doesn’t evolve positively, users can always block their currency support.
Musk said in a tweet that If the primary holders (holders) of Dogecoin sell most of their coins, they will get Musk’s full support. Too much concentration is the only real problem of Musk.
But Dogecoin is Concentrated in a Few Holders
With Musk and his relationship with Dogecoin, it is unclear whether he is mocking or being severe. For some media, it is nothing more than a game. But, as Decrypt explains it well, Dogecoin’s wealth concentration problem is a real deal.
Reports from Changpeng Zhao, CEO of Binance, say that a single individual or entity owns more than 27% of the altcoin’s total market capitalization, with a value of more than $ 7 billion. That puts the entity’s holdings at more than $ 1.8 billion.
Besides, the top twenty DOGE addresses possess more than 50% of the altcoin’s current circulating supply (more than $ 3.5 billion). These addresses could probably be exchanges with Dogecoin as a reserve in their wallets, although they have not received recognition from any business.
Musk explains the medium that concentrated Dogecoin holdings represent a risk for DOGE’s long-term fundamentals (as with any other altcoin), as the price could continue its ascension artificially or, when holders choose to sell, which might affect many holders of lower amounts.
Dogecoin was born as a joke cryptocurrency. The value of this meme has been rising, especially so far this year. Much of these increases are closely related to tweets from Elon Musk and many other influencers.
On February 10, Dogecoin increased 20% because Musk claimed that he had bought it for his son, who is still a baby. Before that, the coin had increased because Musk tweeted a meme that makes fun of The Lion King’s most famous scene.
This action talks about the most recent because there were more. According to reports, DOGE downed 10%, and its price would be 0.06 US dollars. After the tweet, the price started to suffer a smooth increase.
These messages from Musk are now distancing from the ones he shared months ago about the cryptocurrency. On December 20, The Tesla owner tweeted this cryptic message “one word: doge,” a tweet that caused a collective hysteria on the internet.
By: Jenson Nuñez
