TL;DR

• Dogecoin pumped substantially following Elon Musk’s latest comments on a possible “D.O.G.E.” government department.
• Analysts speculate on DOGE’s potential for $1, with some citing Trump’s possible victory as a factor that could drive sustained hype.

DOGE’s Rally

The cryptocurrency sector is slightly in the red today (November 5), with its global market capitalization dropping by over 2% to around $2.38 trillion (per CoinGecko’s data). Bitcoin (BTC) currently trades at around $68,500 (roughly the same level witnessed 24 hours ago), while Ethereum (ETH) is down by 1.7%. 

One leading digital asset that is defying the negative trend is Dogecoin (DOGE). The OG meme coin experienced a 10% price increase on a daily scale, rising to almost $0.17.

Its impressive performance could be attributed to Elon Musk’s comments during his recent appearance on Joe Rogan’s podcast. Tesla’s CEO once again talked about establishing a Department of Government Efficiency (D.O.G.E.) should Donald Trump win the US presidential elections.

This time, Musk shed much more details, claiming the potential division will aim to solve the problem with “the suffocating massive federal bureaucracy” and control the government’s spending, which has gone through the roof in the past years. 

“Our interest payments on national debt now exceed the Defense Department budget. America is on the path to bankruptcy, so we have to cut government spending, or we are just going to go bankrupt just like a person would if he overspends.”

Tesla’s boss is a huge supporter of Dogecoin and one of the most influential people who publicly endorsed Trump for president. As such, it is safe to assume that the final results of the elections could trigger additional price volatility for DOGE. 

Is the $1 Target Plausible?

Numerous analysts noted DOGE’s resurgence, envisioning further increases in the future. One of those who chipped in was the X user Satoshi Flipper.

The trader believes a Trump victory could result in a Dogecoin price rally to as high as $1 due to the constant potential interactions about the Department of Government Efficiency in the next four years.

#DOGECOIN/usdt WEEKLY$DOGE hodlers are going to be so happy when Musk & the US government post about the Department of Government Efficiency ( D.O.G.E ) NON-STOP for the next 4 years

If Trumps wins, $DOGE —> $1 pic.twitter.com/csowJCIOGA

— Satoshi Flipper (@SatoshiFlipper) November 4, 2024

Hitting the $1 milestone seems unlikely at the moment, considering that the meme coin’s market cap must rise above $140 billion for that to happen. DOGE’s capitalization stands at around $24.5 billion, but let’s not forget that it exploded above $90 billion in May 2021.

With the United States presidential election a few hours away from conclusion, crypto investors are exercising caution, which is evident in the low volatility in the bitcoin options market.

Crypto exchange Bitfinex’s analysts reported that crypto investors have adopted a wait-and-see approach, expressing a lack of market confidence in BTC’s current price movements.

Investors Await Election Results

Crypto analysts generally expected heightened volatility leading up to the U.S. presidential election on November 5; however, investors seem hesitant to take action in the market. The front end of the options market faces significant pressure, and implied volatility for bitcoin options is in the low 40s.

Bitfinex explained that front-end volatility is the implied volatility of option contracts closest to their expiration dates. This often indicates the crypto market’s expectations for near-term price fluctuations.

“Another possible interpretation of current low front-end volatility ahead of election day is that it could signal a more profound concern for Bitcoin and altcoins as is shown in both BTCʼs current correction and the more significant corrections being seen in altcoins. Moreover, with options approval pending for Bitcoin spot ETFs, any shifts in sentiment surrounding these developments could further influence volatility and trading activity,” the exchange added.

While implied volatility remains suppressed and investors continue to apply caution, Bitfinex analysts expect the fluctuation structure to change between November 5 and 8. This prediction is fueled by expectations of significant price action within the week, although there is no certainty that the market will move in any particular direction.

If the market fails to experience the expected volatility, Bitfinex says a more substantial issue would likely be at play, and BTC may witness a much deeper correction.

Trump Still Leads on Polymarket

Multiple predictions of BTC at $100,000 by year-end may materialize in the coming weeks, depending on the election outcome. The general market consensus remains that a Republican victory by Donald Trump would be bullish for BTC, while a Democratic win by Kamala Harris could be bearish.

Meanwhile, data on the blockchain prediction platform Polymarket shows that the odds of Trump winning the election are 62.5%, while Harris’s is 37.6%. Data from CoinMarketCap showed BTC trading at $68,628 at the time of writing.

Perhaps due to the massive outflows from the spot Bitcoin ETFs yesterday or some Mt Gox-related FUD, BTC’s price tumbled hard but managed to recover all losses.

The altcoins are relatively sluggish today as well, aside from the two largest meme coins, which have posted impressive gains.

Bitcoin Dumps and Recovers

After it failed to break into uncharted territory last Tuesday, bitcoin started to lose traction gradually and slipped to $72,000 on Wednesday and Thursday. The landscape worsened on Friday as it dropped below $69,000 on a couple of occasions.

After a failed recovery attempt, the bears came back and propelled a few more price declines. This culminated yesterday with a drop to a weekly low of $66,800. This came amid massive outflows from the spot Bitcoin ETFs in the States in the last full trading day before the presidential elections.

However, the cryptocurrency didn’t stay down for long and has recovered roughly all lost value since then. As of now, it trades close to $69,000 in anticipation of the election news and results today and tomorrow.

Its market capitalization has remained at around $1.360 trillion, while its dominance over the alts stands just shy of 57%.

DOGE, SHIB on the Run

Most of the larger-cap alts have remained relatively still in the past day again. ETH, TRX, AVAX, and LINK are slightly in the red, while BNB, SOL, XRP, ADA, and BCH are with minor gains.

Toncoin has dumped the most from the larger-cap alts. TON has lost nearly 6% of its value in the past day and trades below $4.6.

In contrast, the two largest meme coins have surged the most. SHIB is up by nearly 6%, while DOGE has soared by over 11% after the most recent interaction by Elon Musk during a Jor Rogan podcast appearance.

The total crypto market cap is essentially at the same spot as yesterday at just under $2.4 trillion on CG.