Dogecoin Soars $40M in Value Following Chinese Exchange Opens

Dogecoin, the meme-based cryptocurrency, continues its inexorable rise "to the moon" becoming the third most valuable cryptocurrency in the world after a Chinese exchange began trading the coins for yuan.

Dogecoin is just two months old, yet in that time the cryptocurrency has risen to become the world's third most valuable (mineable) cryptocurrency - rising some $40 million (£24.2m) in value in the last 48 hours alone. The market capitalisation of the coin is now over $90 million.

At the time of publication dogecoin had slipped back below peercoin in terms of overall value, but considering dogecoin is rising and peercoin is falling, it is likely we will see the situation change again in the next 24 hours.

While the website coinmarketcap.com lists dogecoin as number four behind bitcoin, ripple and litecoin in terms of mineable cryptocurrencies we can discount ripple as only a tiny fraction of that currency is available to the public.

Chinese yuan exchange opens

While there doesn't seem to be any single reason for the recent spike in value, one of the main drivers is likely to be the fact that Chinese exchange Bter.com has added dogecoin to its list of currencies, meaning it can now be traded directly for Chinese yuan.

This follows last month's announcement by Canadian-based exchange Vault of Satoshi that it would begin trading dogecoin for US and Canadian dollars.

As well as opening up the cryptocurrency to people not interested in mining it, the more exchanges which accept dogecoin in return for fiat currencies the more dogecion will weaken its dependency on bitcoin.

This could be the reason that dogecoin's value has soared in recent days despite huge turmoil in the bitcoin markets.

Vibrant community

The opening up of a Chinese exchange to dogecoin will also make it much easier for the huge Chinese population to get involved with the cryptocurrency.

Built around a very vibrant community, dogecoin came to prominence in January when it helped raise $30,000 for the Jamaican bobsled team to travel to the Winter Olympics in Sochi - as well as helping a trio of Indian skiers travel to Russia.

The currency was created by Jackson Palmer and Billy Markus in early December and will see 100 billion coins mined by the end of 2014, with 5 billion more available in each subsequent year.

The value of a single dogecoin ($ 0.0019) is tiny compared to the value of a bitcoin ($650) but the founders never intended it to be seen as an investment opportunity:

"I think we want to secure its place as the internet currency - perfect for micro-transactions and tipping people you think are awesome," Palmer told IBTimes UK last week.