Dogecoin Is the Newest Crypto Star
Dogecoin, the current star of the cryptocurrency world, was named after a meme of the Shiba Inu dog and was started as a joke.
It is no longer a joke; it follows Bitcoin, Ethereum, and Binance in order of market cap, currently at $69 billion. According to data released by Coin Metrics, Dogecoin price continues to surge, going up 40 percent on Tuesday (May 4).
The current run is part of an epic tear that has driven the value of the crypto up 600 percent in a matter of a few weeks, and 11,000 percent since early January. The coin is currently worth about 64 cents, up from 54 cents earlier in the day.
Factors in the Price Action
A few things are taking place that are being factored into the price. There is considerable high-profile support and a following by retail investors who are all aiming to pump the price of the coin to a dollar.
Tesla CEO, Elon Musk, tweeted recently, “The Dogefather SNL May 8,” which references both the coin and Musk’s upcoming appearance on Saturday Night Live. Musk is not the only one supporting Dogecoin. Mark Cuban, owner of the Dallas Mavericks of the NBA has also posted several times in support of the crypto.
In a May 2nd tweet, Cuban said that as long as companies are happy to accept Dogecoin for products and services, it can be a useable form of tender. Cuban went on to say, “Dogecoin may hold its buying power better than money in the bank.” He also said that should interest rates skyrocket, or the amount spent stagnate, Dogecoin may do so as well. Yes, it is a joke, but at the moment it is legitimate.
Even as the crypto skyrockets, experts are cautioning investors against going into the crypto just to make money. The experts reiterate that crypto is highly volatile, which means the gains could quickly reverse at any time.
Invest No More than You Are Willing to Lose
The majority of financial experts are of the same mind. They suggest that those interested in investing in cryptocurrency set aside just a small amount. The same warning has been issued by the Financial Conduct Authority in the United Kingdom.
Perhaps Ben Weiss, co-founder, and CEO of CoinFlip said it best. “Never invest anything that you are not willing to part with.” Weiss also said, “If you like what you see, and you believe Dogecoin could be viable in the future, or you are a fan of the movement, then go ahead and invest. On the other hand, if you think the movement is a short-lived fad, then don’t invest.”
Weiss also sent out a note of caution to first-time crypto buyers. Don’t jump straight into Dogecoin unless you have already invested in other coins. Bitcoin has a track record. It has been around for 10 years. This fact alone makes it an altogether different risk level than putting your money into a newer alternative coin.
Weiss also suggests that investors should not invest in Dogecoin for no other reason than to turn a quick profit.
Buy for the Long Haul
Although Weiss does suggest a note of caution, he is, however, a supporter of investing in cryptocurrencies as well as Dogecoin. He recommends that all investors should hold some digital currency, even if it only makes up a small part of the total portfolio.
Weiss says, “You don’t want to totally miss out.” “You may end up kicking yourself for the things you doing, and the missed opportunities that go with it.”
For those who are keen on investing in alternative digital assets, first, assess where you stand with your finance and investment portfolio. This assessment helps to determine if you have the extra capital to put into a risky asset.
Anjali Jariwals, a CPA and a certified financial planner, suggests those that do have extra capital should put money into Bitcoin, but on a day when it’s down. He goes on to say, “Put money into it and just let it sit and season for a while.” In this way, there is no need to make decisions every time the price fluctuates one way or the other, which, right now, is every day or every few days.