If You're Thinking of Investing In Dogecoin... READ THIS!

It's clear that there is so much hype around Dogecoin with the coin just hitting new all time highs... But can Dogecoin continue to climb and is it a worthy investment? Let's dig in. 

There is every chance that during this bull run Dogecoin could potentially hit $1, but in order for that to happen there would have to be around $130BUSD invested into the coin. Dogecoin currently has a market cap of $44B making it currently at time of writing, the 6th largest cryptocurrency in marketcap.... And it's just a meme. 

When any cryptocurrency moons to the sky in price it isn't healthy and it's incredibly difficult for the price to be maintained, especially when more and more people become in profit and wish to take some of those profits. Expecting the price to continue to keep pumping, even if it does in the short term, is something that you should not be betting on! The current downside potential is so high it would outweigh the potential for the price to climb higher, especially as the price for Dogecoin just surged with no fundamental backing other than an Elon Musk tweet (which in this case was about Doge barking at the Moon). 

Elon Musk controls so much of the hype around Dogecoin. If Elon puts a positive tweet about Doge the price surges to reflect that, just like what happened recently when "Doge Barking at the Moon" was posted on the 15th April and the price hitting an all time high just 2 days later... But what if he decided overnight to put a negative tweet out, suddenly deciding that he no longer likes Dogecoin.... Well sorry but your savings would be in the trash can and I don't want you to be in that position. 

68.1% of the Dogecoin tokens are currently owned by a majority of just 100 addresses. THIS IS NOT GOOD FOR ANY CRYPTO! If you compare that to Bitcoin, only 13.7% of the Bitcoin supply is in the 100 largest wallet addresses and while this is not ideal either, it is a far better equal distribution compared to Dogecoin... But what does this mean? 
This means that the top holders have way, way too much concentration in their supply pockets right now which means they can control the price of Doge. THIS IS A DANGEROUS POSITION TO BE IN! Your investments should not hinge at the opinion of a small collection of people and if they suddenly all decided to take profits and decided to sell most of their holdings to take profits... Well the price of Doge is going to drop and drop hard. 

In terms of returns on your investment I would warn you about investing into Dogecoin, especially at this particular moment in time. After a huge surge in price rise in a meme, I would be extremely cautious about investing into this right now. If you want to invest in Dogecoin, wait for a dip, wait for the price to correct before jumping in and just like any investment - do so at your own risk. While the price may continue to surge, maybe even hitting $1/$2... who knows... I personally believe it's just too way risky for an investment option and I can't personally see an additional $100B being pumped into something that is just a meme in the immediate future. 

I personally believe that there are far better investment options out there regarding cryptocurrency and currently do not own any Dogecoin. If this changes I will update this in the future but especially right now, for the immediate future I will not be investing into Dogecoin at this time. I am not willing to bet that this will be the cryptocurrency of the future. 

Disclaimer: I am not a financial advisor and any investments you make with your money are done so at your own risk. Happy investing and good luck to us all! ;) 

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Nihinlola Kehinde - Apr 17, 2021, 5:35 AM - Add Reply

Doge coin is risky to invest on but for long term holder you can hold

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Sam - Apr 17, 2021, 6:12 AM - Add Reply

I agree. We are still very early to crypto but there are in my opinion other cryptos doing more and that have greater potential, especially while Dogecoin corrects after this current surge.

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jordan - Jun 6, 2021, 8:38 AM - Add Reply

nice article. i agree with you, the coin has no utility and the hype just wont be enough to float it at a good price. saying that i still bought a small amount just incase. =D

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