After starting 2025 on a scorching observe, the value of fan-favorite crypto Dogecoin(CRYPTO: DOGE) fully cratered after an enormous sell-off within the first quarter final 12 months. All advised, Dogecoin misplaced roughly 60% of its worth final 12 months.
The query some buyers could also be asking now could be whether or not a bounce again might be in retailer given Dogecoin’s extended sell-off.
Let’s dive into why the cryptocurrency market might rally in 2026. From there, I am going to define the place I believe significant capital will stream and assess whether or not Dogecoin might be again on the upswing.
Picture supply: Getty Pictures.
Whereas many economists are projecting one other sturdy 12 months for equities, I believe the cryptocurrency market is also on the rise in 2026.
The primary potential catalyst for a crypto rebound might be dictated by the Federal Reserve’s actions. Ought to the Fed proceed to decrease rates of interest, buyers theoretically can have extra discretionary earnings.
When buyers usually are not spending as a lot of their cash to pay down debt, they could be extra inclined to reinvest their financial savings. Whereas that is excellent news for shares, it may also be excellent news for extra speculative investments reminiscent of cryptocurrency.
One other tailwind for crypto this 12 months might be the present state of worldwide affairs. Proper now, geopolitical tensions are current in Europe, the Center East, and South America. Furthermore, President Donald Trump’s tariff situation stays fluid, notably because it pertains to commerce coverage with main companions like China.
When the macroeconomic image turns into overwhelmingly murky, buyers are likely to shift capital away from shares and migrate towards various property — gold, silver, actual property, and lately, cryptocurrency.
Cryptocurrency is a way more unstable and unpredictable asset class in comparison with shares or bonds. For that reason, it is a good suggestion to be aware of which cash have essentially the most demand relative to their friends.
Through the previous couple of years, each retail and huge institutional buyers have taken a liking to regulated merchandise — notably, spot Bitcoin exchange-traded funds (ETFs). Though Bitcoin stays essentially the most mainstream cryptocurrency, significant capital can also be being allotted towards blue chip alternatives reminiscent of Ethereum in addition to established altcoins like XRP and Solana.
In contrast, enthusiasm for Dogecoin seems to be diminishing. This is probably going attributable to the truth that Dogecoin is a meme coin and has little-to-no utility in the true world.
With a distinct segment developer neighborhood and restricted functions on the earth of decentralized finance (DeFi), Dogecoin lacks a compelling worth proposition for buyers searching for sturdy development.
The chart under illustrates Dogecoin’s value fluctuations throughout the previous 5 years. Trying on the long-term developments, there may be an argument to be made that the token’s present value of about $0.15 represents a flooring value. What I imply by that’s the value of Dogecoin typically surges after bottoming within the vary of $0.10 to $0.15.
The nuance right here is that Dogecoin’s rallies are fleeting. The coin has by no means been capable of preserve significant value appreciation. So whereas a value enhance might be in retailer within the close to time period, historical past signifies that Dogecoin will plunge proper again to its flooring.
With curiosity in respectable cryptocurrencies on the rise, together with Dogecoin’s lack of sustainable value appreciation, I believe extra buyers will proceed shifting away from the coin’s unpredictable patterns and deploy capital into extra established investments. By the top of 2026, I believe Dogecoin will likely be buying and selling at a a lot lower cost than in the present day.
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Adam Spatacco has no place in any of the shares talked about. The Motley Idiot has positions in and recommends Ethereum, Solana, and XRP. The Motley Idiot has a disclosure policy.
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