The end of January 2021 was marked by the amazing uprise of retail investors who organized themselves on the r/WallStreetBets (WSB) subreddit. Their goal was not to make as much profit as they could, but to stick it up against major players on the financial markets, such as big hedge fund managers. The tech savvy millennials and members of Generation Z bought up stocks of GameStop (GME) and AMC Theatres (AMC) with no intention to sell, aiming to perform a short squeeze and pressure investors, who held short positions to either buy more stocks of liquidate their positions. The market battle between David and Goliath got even less fair when platforms such as Robinhood, often utilized by WSB investors, restricted the buying of aforementioned stocks. While this move lifted a lot of dust it also acted as free advertisement for cryptocurrency space and DeFi, where the risk of this sort of market interference is significantly lower. Last but not least, the WallStreetBets movements sparked the creation of its cryptocurrency-themed copycat r/SatoshiStreetBets, whose promotions contributed to the fact that two of the coins in this week’s selection skyrocketed so high.
1. Dogecoin (DOGE)
The cryptocurrency Dogecoin was introduced as a joke in December 2013 by Billy Markus. Markus built the cryptocurrency project around the Shiba Inu doge meme that went viral in 2013 and the Dogecoin even uses the Doge meme as its official logo. Surprisingly, the currency took off. Even more, it developed a relatively large community on social platforms such as Reddit, which used Dogecoin to tip other members of the community and for performing similar micro-transactions. The Dogecoin community also raised funds to sponsor their own NASCAR racer for a few races and pay for a physical gold Dogecoin to be delivered to the moon via crowdfunding. Although the currency is regarded as a joke by more serious investors, Dogecoin is currently the 13th largest cryptocurrency by market capitalization with almost 130 billion Dogecoins mined since 2013.
Subreddits r/WallStreetBets and r/SatoshiStreetBets pump DOGE
Users on r/SatoshiStreetBets, a cryptocurrency-themed version of the r/WallStreetBets, the subreddit which kickstarted the GameStop phenomenon, started posting memes about Dogecoin and encouraging each other to buy the coin. The campaign promoting to buy Dogecoin soon spread across other platforms, such as TikTok and Twitter. Largely (if not even solely) because of this movement, DOGE displayed triple-digit gains on January 29, when the price spiked from $0.0076 to an all-time high of $0.077 within 24 hours. Such pump (and dump) campaigns are nothing new for DOGE. Let’s remember the viral TikTok video from July 2020 that attempted to push the price of DOGE to $1. Dogecoin also tends to pump when Elon Musk promotes the meme coin on Twitter. It happened on March 3, 2020, December 20, 2020, and Musk may have referred to Doge in his recent tweet too:
At the time of writing, DOGE is trading at $0.0358, which is 55% lower than the ATH price but at the same time, over 500% higher than prior the pump. Does DOGE hold enough oomph to justify the price or will DOGE drop back to where it was changing hands prior to the rally – below $0.008?
2. Ripple (XRP)
XRP is a cryptocurrency that was launched in 2012 by Chris Larsen, Jed McCaleb and Arthur Britto. Ripple’s network uses a unique consensus protocol, which is neither proof-of-work nor proof-of-stake to facilitate very fast and cheap transactions. The maximum supply of XRP is 100 billion coins, which were all created at launch. At launch 80% of the total XRP supply was given to fintech firm Opencoin, a company that was later renamed to Ripple Labs in 2015. As of today, Ripple still holds more than half of the total XRP supply. However, most of the company’s XRP holdings are locked in escrow and can only be accessed periodically.
WallStreetBets Causes 60% XRP price increase amidst turmoil with the SEC
Ripple has recently found itself amidst a legal war with the U.S. Securities and Exchange Commission (SEC). The SEC officially revealed that they filed a lawsuit alleging that Ripple, its CEO Brad Garlinghouse and its executive chairman Chris Larsen raised $1.3 billion through the sale of unregistered securities Ripple, on December 22, 2020. The filing triggered a massive sell-off of XRP, which was additionally amplified by the fact that many exchanges, including Coinbase, Binance.US, Bitstamp, Crypto.com, Bittrex and OKCoin announced the delisting and halt of XRP trading. Affected by the restricted trading on exchanges and the uncertainty surrounding the SEC vs. Ripple lawsuit, the price of XRP stayed below $0.30 for most of the time. However, on January 30, Reddit investors got involved. Much like it was the case with DOGE, the r/Wallstreetbets cryptocurrency-focused off-shoot r/Satoshistreetbets started promoting XRP. The subreddit was apparently very successful with its pump, as XRP ended the day 60% higher, making XRP the best performing asset of the day by far. XRP rose from $0.28 to a peak at $0.51 before profit selling pulled the price back to $0.41. However, the coin has since almost doubled its value, reaching a high of almost $0.75, before it dropped back to around $0.40. XRP is currently changing hands at around $0.365 and is still up by 35% compared to 7 days ago.
In addition, the legal battle with the SEC has entered a new chapter, as Ripple filed its official answer on January 29. Stu Alderoty, the General Counsel at Ripple, shared the summary of the company’s preliminary response on Ripple’s official blog. At multiple points in the documents, Ripple aims to debunk SEC’s claims that XRP is an unregistered security. The “Answer” explains that there was no “investment contract” with the XRP holders whatsoever and tries to prove that XRP is solely a virtual currency and thus, outside the SEC’s jurisdiction. In addition, Ripple never held an ICO or offered future tokens to raise money. Holding XRP also does not entitle the holders to a portion of Ripple’s revenue or profits.
3. Alpha Finance (ALPHA)
Alpha Finance Lab is a researching and innovation-focused blockchain project that works on the frontiers of the decentralized finance space. The main goal of the project is to fill in the market gaps in the DeFi section with a simple yet novel solutions.
Alpha Honora V2 Is Live
The Alpha Finance team have recently announced that Alpha Honora V2 was set to launch on February 1. The upgraded version of the Alpha protocol, which is already live, features an integration with leading DeFi protocols including Uniswap, SushiSwap, Balancer, Curve Finance, and Cream Finance. Consequently, users will be able to lend ETH (ibETHv2), USDT (ibUSDTv2), USDC (ibUSDCv2), and DAI (ibDAIv2). In addition, Alpha Honora V2 supports leveraged pools such as the Curve’s 3pool allowing CRV farming with leverage on USDT/USDC/DAI, Balancer’s PERP/USDC pool enabling PERP farming with leverage on USDC, SushiSwap’s SUSHI/ETH pool enabling SHUSHI farming with leverage on ETH, and Uniswap’s UNI /ETH pool with leverage on ETH. To celebrate the launch of the upgrade a meme competition with rich rewards was set in place. All the details about the launch can be accessed here.
In the expectation of the V2 launch, ALPHA soared towards its new all-time high price of $2.36, achieved on January 30. It will definitely be interesting to see how it will the platform’s native cryptocurrency will perform in future weeks. ALPHA is currently changing hands at $2.03, with support levels lying at $2.02, $1.90 and $1.80.
Andrew is a writer that does most of his work on cryptocurrency-related topics. While he’s primarily interested in Bitcoin, he also follows major altcoins and the innovative ideas that new cryptocurrency and blockchain projects are bringing to the table.