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Bitcoin vs. Bitcoin Dogecoin – Which Cryptocurrency Offers Best Returns in 2024?
- Despite fundamental differences, Bitcoin and Dogecoin share a strong correlation
- Short-term trajectory pointed to an increase in the price of DOGE and a decrease in BTC
Few cryptocurrencies have survived a decade of existence. And yet, Bitcoin [BTC] It is Dogecoin [DOGE] have been on the market for over 10 years. Despite this, few are aware of the difference between the two.
In this article, AMBCrypto will dive into the similarities and differences between Bitcoin and Dogecoin. You will also learn about their respective price actions and on-chain conditions.
Bitcoin vs Dogecoin: Who Takes the Crown?
Bitcoin and Dogecoin have a few things in common. Most notably, they both use the Proof of Work (PoW) consensus mechanism.
This similarity is why blockchains are among the top projects that still rely on mining rather than using validators. However, the main difference between them is their supply.
Although the supply of Dogecoin is unlimited, the maximum supply of Bitcoin is 21 million coins, making it more scarce asset than DOGE. At press time, DOGE was trading for $0.12.
This was an increase of 38.19% on a year-to-date (YTD) basis. As far as Bitcoin is concerned, it was valued at $61,579 – an increase of 39.42% in the same period.
When we looked at the prices of both cryptocurrencies, we noticed that there was a strong correlation. For example, according to Macroaxis, the Bitcoin vs. Dogecoin correlation stood at 0.98.
Source: Macroaxis
Values of correlation coefficient range from -1 to +1. When the reading is close to -1, it means prices diverge and rarely move together.
However, a coefficient close to +1 implies the opposite. Therefore, the correlation between BTC and DOGE showed that if you invested some money in both coins since the beginning of the year, you would get almost the same returns.
However, Bitcoin’s returns would be slightly higher. Ergo, the question – Will prices continue to move in the same direction? Let’s take a look.
DOGE takes advantage this time
To investigate this possibility, AMBCrypto analyzed the In and Out of Money Around Price (IOMAP). This indicator, provided by IntoTheBlock, identifies support and resistance levels.
It does this by grouping addresses that buy within a certain price range. Some of them will make a profit and some will make a loss. Typically, the larger the set of addresses, the more solid the support or resistance provided.
At press time, AMBCrypto has discovered that a sell-wall he appeared at $62,134. At this point, 1.64 million addresses have purchased 759,670 BTC. At the other end, 755,240 addresses purchased 445,280 BTC at around $60,793.
Source: IntoTheBlock
Considering the difference, Bitcoin is likely to face another decline. If this is the case, the coin is at risk of falling below $60,000. As such, it may not be the best time to buy BTC.
For Dogecoin, it was an entirely different scenario. Unlike Bitcoin, DOGE had its support at $0.12. This is because 86,480 addresses bought 6.87 billion DOGE at that price.
There were more than 33,520 addresses that purchased 717.77 million coins for a higher value. Thanks to this condition, DOGE can only negotiate at a higher value In short time.
Source: IntoTheBlock
Realistic or not, here it is DOGE Market Cap in BTC Terms
Furthermore, the possible target for Dogecoin is between $0.13 and $0.15. Simply put, memecoin could offer a better return than Bitcoin in the short term.