Ripple CEO Blasts Dogecoin, Questions Its Benefit To The Crypto Market
Dogecoin has had an impact that has no doubt been felt around the entirety of the crypto space. However, whether this impact has been good or bad is still a hotly debated topic in the space. The digital asset had paved the way for cryptocurrencies that have no use cases to speak to be at the forefront of the market and its break into the crypto top 10 is evidence of its growth.
Nevertheless, having tokens that serve no purpose other than just ‘being’ has shown just how much power a strong community wields. For most, Dogecoin has been a way to make some money while serving as a gateway into the crypto realm. For others like Brad Garlinghouse, Ripple’s CEO, Dogecoin’s rise to fame has not done the market any favors.
Dogecoin Not Good For The Market
Ripple CEO Garlinghouse was on CNBC to talk about the crypto market and how inflation was affecting it. The conversion switched to Dogecoin where Garlinghouse shared his thoughts on the projects. Foremost of all that he did not believe that the meme coin is good for the crypto market.
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The CEO explains his stance with the lack of utility in the Dogecoin project. Even the creators of the project had said that they had created the altcoin as a joke and did not believe it would go anywhere.
“I’m actually not convinced, somewhat controversially I guess, that dogecoin is good for the crypto market,” said Garlinghouse. “It was built as a joke, then it got some momentum from some high-profile people like Elon Musk,” he added.
DOGE price trending low | Source: DOGEUSD on TradingView.com
This school of thought had been earlier shared by Tony Richards, an Australia Reserve Bank official, at a conference, although Richards had been making his case against the viability of crypto versus fiat.
How Inflation Is Playing Out In Crypto
Garlinghouse pointed to growing inflation as the reason that many projects like Dogecoin were getting so much attention. The fear of rising inflation rates has no doubt led to an influx of new investors into the crypto market, driving prices up. The CEO explained that this had led people to find assets that would prove to be an adequate inflation hedge.
“When people are concerned about holding a fiat currency that might be inflating, and that’s devaluing, they’re looking at: ‘How can I hold other assets that won’t have that same inflationary dynamic?’”
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However, Garlinghouse explained that it is these same inflationary concerns that have kept him from Dogecoin. “Dogecoin has some inflationary dynamics itself that would make me reluctant to hold it,” said the CEO.
Garlinghouse’s argument does have some merit to it as the Dogecoin supply is not capped. This means that there is an infinite supply of the asset, giving credence to the CEO’s concerns about its inflationary nature. Nevertheless, Dogecoin remains a community favorite and has managed to hold its own in the market, currently ranking as the 10th largest cryptocurrency by market cap.
Featured image from CNET, chart from TradingView.com