Let’s talk about Dogecoin … the latest speculation-driven phenomenon to trap investors.
What’s going on here?
Why are people taking such a risk on what began as a joke to poke fun at bitcoin?
Curious, I asked Clint and Ted.
Big picture, I think a lot of the speculation taking place last year and early this year in stocks has migrated to the crypto space. There’s less of an institutional investor presence there, so it’s easier to move prices around.
Dogecoin is up over 10,000% year to date. The movement right now is to get the crypto to $1. It currently trades at $0.49. Given that it’s easy to mine and the supply is unlimited, this is NOT a long-term investment or store of value. And frankly, it’s a dangerous short-term investment as well.
Someday, cryptocurrencies might play a role in economic life that justifies assigning them lasting value. That hasn’t happened yet, no matter what their boosters say. Until that day comes, investing in crypto is purely speculative. Making money on it depends on someone else being willing to buy them from you. As the history of speculation shows, that strategy can fall apart very fast.
Eccentric South African billionaire Elon Musk seems to have strong opinions about cryptocurrencies. His comments regularly move the needle for both Dogecoin and bitcoin.
This got me wondering…
Dogecoin: Real Opportunity … or World’s Most Valuable Joke?
Answer this quick 30-second poll to let us know your thoughts on this unusual currency.
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I look forward to seeing what you say.
Publisher, The Bauman Letter