Mark Cuban Defends the ‘Infinite Supply’ of Dogecoin
Dogecoin has become a well-known meme token, especially after it has received a lot of support from the CEO of Tesla, Elon Musk.
It has been enjoying a steady popularity in the marketand its inflation has come under criticism from many. This week saw Mark Cuban take the responsibility of defending the token.
Different from Bitcoin
The owner of Dallas Mavericks responded to a tweet from CoinDeskin order to defend Dogecoin inflation.
He is a long-time fan of the meme currency and said that since it creates 5 billion a year, it is able to keep a low coin price and this improves its accessibility.
The Shark Tank investor said that this was what appealed to people about Dogecoin when it comes to buying products.
He said that it made DOGE more favorable for purchasing physical products, as opposed to Bitcoin (BTC), or even Ethereum (ETH).
He went on to say that if someone has $100, it would be hard for them to be excited about purchasing a fraction of ETH, or BTC, but they would certainly be happy where DOGE is concerned.
Elon Musk
The comments from Cuban were in line with what Elon Musk had said back in February. He had stated that the ‘inflationary’ nature of DOGE distinguished it from Bitcoin.
The SpaceX CEO had also said that Dogecoin inflation was what helped the token in maintaining a ‘stable price’.
Billy Markus, the co-founder of Dogecoin, has also said that fans of the meme asset often contact him and request him to reduce the supply.
Some of them also ask him to make the token deflationary and make changes in its code. This is due to the fact that Dogecoin’s inflation helps ensure price stability.
This is in conflict with the reason that people decide to invest in DOGE.
Is inflation a good thing?
The supply of Dogecoin increases by 5 billion every year, which means that an additional $5 billion investment is needed for reaching a $1 price.
Last year, a $130 billion cap was needed to reach $1 and it will be $140 billion next year. This is in direct contrast with tokens like Bitcoin that have a fixed supply, or EverGrow that are hyper-deflationary.
But, the good news about Dogecoin is that since it is inflationary, it is able to maintain price stability as opposed to EverGrow or Bitcoin.
This means that Dogecoin is a good investment for anyone who is waiting for the day when crypto will begin to be used as a fiat alternative.
However, investors who are looking to make profits off the price of Dogecoin should look for a different investment option like Bitcoin because they cannot achieve that with the inflationary nature of the token.
