Dogecoin (DOGE), the meme-inspired cryptocurrency, is finally getting the market reaction it has long sought. However, the reasons behind its current surge are not necessarily tied to its fundamental value or technical innovations. Instead, external economic and political factors are playing a crucial role in influencing its price movement.

Current Market Performance

As of February 28, 2025, Dogecoin is trading at approximately $0.2087, reflecting a modest increase from its previous close. The intraday highs reached $0.2114, while the lows dropped to $0.1968. While this price action might indicate bullish sentiment, it is crucial to understand what is actually driving this movement.

Key Economic and Political Influences

One of the biggest external factors affecting DOGE’s price is global economic uncertainty. Recently, former U.S. President Donald Trump imposed tariffs on imports from Canada, Mexico, and China. This move led to widespread selloffs in global markets, impacting traditional assets and cryptocurrencies alike. Major cryptos like Bitcoin, Ethereum, Solana, and XRP faced significant declines. Bitcoin, for instance, plunged below $90,000 to $86,481, reflecting broader concerns about U.S. economic policies and their impact on global trade. Dogecoin was also caught in the wave, dropping nearly 20% during this period.

In addition, Elon Musk’s renewed interest in Dogecoin has stirred market speculation. Musk’s latest initiatives, particularly the DOGE project aimed at reducing government costs and influencing Treasury yields, have created further volatility. Some analysts believe this could be an attempt to integrate Dogecoin into mainstream financial systems, but skepticism remains about the long-term viability of such a plan.

Market Sentiment and Meme Coin Decline

Despite Dogecoin’s current uptick, meme coins as a whole have been struggling. After leading a major rally in 2024, meme-based cryptocurrencies have witnessed substantial pullbacks. Controversies, regulatory scrutiny, and diminishing retail investor enthusiasm have all contributed to this decline. The market capitalization of meme coins, which peaked at $137 billion in December 2024, has since plummeted by 59% to $56.2 billion.

This downturn in meme coins suggests that investors are growing wary of speculative assets, shifting their focus toward cryptocurrencies with stronger fundamentals. The recent rally in DOGE may be more of a temporary reaction to external news rather than a sustainable growth trend.

Investor Takeaway: Proceed with Caution

Dogecoin’s price movements underscore the importance of understanding market sentiment and external influences before making investment decisions. While the short-term gains might seem attractive, long-term sustainability remains a concern. Investors should keep an eye on broader economic factors, regulatory developments, and technological advancements before making high-risk investments in meme coins like DOGE.

Final Thoughts

Dogecoin’s latest price action highlights the unpredictable nature of cryptocurrency markets. While external factors like political decisions and economic policies continue to drive speculation, the long-term viability of meme coins remains uncertain. Investors should exercise caution, conduct thorough research, and diversify their portfolios to mitigate risks in a volatile market.

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–> Dogecoin price chart is sourced from CoinGecko