After Dogecoin’s Parabolic Rise, Is It Still A Good Investment?
The equity markets are a safe and pretty predictable way to invest. However, there is little fun in it. If you are the type that invests through index funds, as most people do, then you pretty much know what to expect. The S&P 500 index, for instance, does an average of 10% a year.
One market where you can get some thrill investing, is cryptocurrency. If you are the curious type, then you have already heard of Bitcoin and the tremendous wealth that it has created over the last decade.
However, there is a slight problem. If you are just hearing about Bitcoin now, then chances are that you are a little late. For starters, you need to put in a substantial amount of money to make anything meaningful out of it. Gone are the days when you could throw $1000 at Bitcoin and become a millionaire off it.
At an average price of $54k, you would have to put in over $600k to make a million dollars out of Bitcoin. This is a conservative estimate based on Bitcoin getting back to its all-time highs of $64k.
The good news is that, in the crypto market, you have plenty of options. One of the options with the potential to be the next Bitcoin is Dogecoin (DOGE).
What Is Dogecoin All About?
Dogecoin is the poster child of how crazy the crypto market can get. Back in 2013, the rising Bitcoin price, and stature, drew in lots of copycat projects.
Most of them were riding the Bitcoin wave with no real value at all. To make fun of how irrational the market had become, two software guys, Jack Palmer and Billy Marcus decided to create a joke coin. The idea was to make a mockery of the many shit coins that had come up.
They gave the coin the logo of a Shiba Inu dog, just to make the joke complete. However, they gave it all the attributes of Bitcoin, albeit with a little twerk.
Some of the core aspects of Dogecoin that mirror Bitcoin are:
- Decentralization – Like Bitcoin, there is no central entity behind Dogecoin
- Mining – Like Bitcoin, new Dogecoin’s coming into existence through mining
- Privacy – Dogecoin, like other cryptos, does not reveal the identity of the owner
The twerk that Dogecoin founders added was to make it inflationary. Unlike Bitcoin, whose total supply is capped at 21 million, there is no limit to the number of Dogecoins that can come into existence. This feature was to enhance the idea that it was just a joke.
Little did Markus, and Palmer, know that what they had created would attract a cult-like following. Its association with the cute Shiba Inu dog drew a lot of followers. Dogecoin’s easy-to-mine nature compared to, say Bitcoin, or Ethereum made it even more attractive.
By 2017, Dogecoin had transformed from a joke into crypto with real market value. However, it is in 2021 that Dogecoin’s true value became apparent. This was after Elon Musk made it his pet project. Musk tweeting about Dogecoin in 2021 has seen its value go parabolic and real-world adoption increase.
Read Also: Bitcoin vs Dogecoin
What’s Dogecoin’s Value?
If you want to get into the crypto market but find the price of Bitcoin a little too high, then you should possibly consider Dogecoin. Not only is it nominally much cheaper, but its potential for exponential gains is higher.
On April 5th, 2020, Dogecoin was trading at $0.0019 a coin. By May 7th, 2021, it had hit an all-time high of $0.73. That is a more than 12,000% increase in value. For context on how big of a deal it is, someone who put $10,000 into Dogecoin in April 2020 had made over $3.8 million by May 2021.
Dogecoin has since corrected and is now trading at around $0.22. Nonetheless, anyone who bought back in 2020 is sitting on a tidy profit.
Is It Too Late To Buy Dogecoin?
If this is the first time you hear about Dogecoin, then chances are that you are still new to crypto as a whole. If that’s the case, then you are better off sticking to the predictability of the stock markets.
In the meantime, spend as much time as possible studying Dogecoin and crypto in general. This is one of those markets where most of those in it, even techies, don’t fully understand how it works.
Do not feel like you are too late to try a hand in it. Crypto adoption is still in its infancy, and actual adoption is yet to come. Even Bitcoin, the foremost cryptocurrency, is only used by a very few people globally.
That said, it never hurts to throw money that you can afford to lose at emergent opportunities. You never know what could come out of it.
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Virtual currencies are highly volatile. Your capital is at risk.