Key Insights
- Grayscale has been increasingly launching financial products related to single-asset cryptos for months now.
- Its most recent addition to this list is a Dogecoin Trust, designed to cater specifically to institutional investors.
- This comes amid mounting institutional interest from investors all over the world.
- This excitement could play a key role in pushing Dogecoin upwards to the 50-cent mark.
- A retest of the $0.28 zone could be required for this rebound to take effect.
Grayscale has just launched a dedicated investment fund for Dogecoin.
This marks yet another expansion from the asset manager, into single-asset products.
Just like a Dogecoin ETF, this trust is designed to cater to institutional investors directly.
The biggest players on Wall Street will now have access Dogecoin directly, in one of the most bullish developments for the cryptocurrency in recent years.
Could this be the kicker that Dogecoin needs?
Institutional Investors Are Becoming More Interested In Memecoins
One fun fact about Dogecoin is that it was originally forked from Litecoin, which itself was forked from Bitcoin.
Because of this, Dogecoin is a Proof of Work network and is very similar to Bitciun.
The only difference is that it features more efficient transaction handling, and has no supply cap.
Source: Twitter
This Foray from Grayscale comes amid a surge of interest from institutional investors in memecoins.
The trend initially gained momentum right after some of the biggest memecoin launches of the year, like the official $TRUMP and $MELANIA memecoins on 18 and 19 January respectively.
These memecoins did much to show institutional investors just how powerful memes can be, in terms of generating trading activity.
Moreover, 21 January saw asset managers like Osprey Funds and REX Shares file applications to launch ETFs for memecoins like DOGE, TRUMP and BONK.
The Growing Crypto Fund Portfolio
Interestingly, the Dogecoin Trust is the latest addition to the list of Grayscale offerings.
Over the last few months, the asset manager has launched several new products that cater to difference segments of the crypto market.
Source: Twitter
In December for example, it introduced investment funds for Lido and Optimism—right after proposals for similar products for Aave and around 35 other altcoins like Worldcoin, Pyth and RUNE in October.
Earlier than this In August, the asset manager even launched three other investment trysts focused on protocol tokens from Sky (formerly MakerDAO), Bittensor, and Sui.
Could This Help Dogecoin Rally?
CoinMakretCap data shows that Dogecoin currently trading around the $0.325 price level, with a price decline of 4% on the daily timeframe.
Source: CoinMarketCap
The cryptocurrency is also down by around 7% over the daily timeframe, as illustrated in the snapshot above.
In the charts, the cryptocurrency is trading within a bull flag formation, which is a strongly bullish pattern.
Source: TradingView
As shown, the bears recently succeeded in pushing the price underneath the $0.33 zone, which coincides with the 38.2% Fibonacci retracement level.
This means that Dogecoin might travel further down and test the underside of this formation around the 50% Fibonacci level of $0.28.
With this being said, Dogecoin could rebound and test the upper trendline of this formation around $0.39.
If the bulls apply enough momentum at this price level, the price of the cryptocurrency could break out towards the $0.485 zone.
