Since its release in 2013, Dogecoin has emerged as one of the most popular cryptocurrencies globally. Before 2020, Dogecoin saw a number of major pushes and subsequent falls but failed to gain much traction. With an unexpected jump of over 12000% between January and May of 2021—Dogecoin has become one of the well-known cryptocurrencies.
While many new investors have been drawn in by Dogecoin’s price and popularity, it is essential to be careful before investing in Dogecoin. Although it is one of the very few cryptocurrencies to gain widespread recognition, future outcomes cannot be predicted by looking at the past.
Dogecoin’s present status is still up for discussion. Some argue that it is still vulnerable to push and crashes since only a few wallets possess the bulk of Dogecoin, even though many think it better represents the values and interests of the broader community.
Let us walk you through some essential tips to help you decide how much to invest in Dogecoin while delving deeper into whether Dogecoin is worth investing in.
Is Dogecoin a good investment?
While Dogecoin gave investors much hope in the first four months of 2021, Dogecoin still needs to retain the growth momentum. Investors who have invested in Dogecoin still hold it with the hope that Dogecoin will bounce back and prove to be a worthwhile investment, but this cryptocurrency has yet to show any further signs of growth. When considering investing money, it is essential to ask whether the asset fits your portfolio.
Dogecoin is a risky, unpredictable investment—only invest in it if you have a solid financial foundation. According to general investing guidelines, riskier investments like these must be at most 10% of your investment portfolio.
At around $0.08 in January 2023, Dogecoin must have done better. Dogecoin investors who purchased it between 25 and 45 cents in the first few months of 2021 have seen huge losses on their investments.
Although Dogecoin still has a $10.88 billion market cap as of January 2023 and is accepted at almost 2000 places as payment, from premium cars to goods and services, you must consider investing in Dogecoin. However, it’s also crucial to keep in mind that Dogecoin’s price is prone to extreme fluctuation daily and has yet to be used much other than to make payments faster than using bitcoin.
With all this in consideration, it is advisable to allocate less of your portfolio to Dogecoin, despite the fact that enthusiasts are ready to hold it as a long-term investment.
4 Tips on deciding how much to invest in Dogecoin
There are a few things you must take into account before investing in a cryptocurrency like Dogecoin. You’ll be in a better position to decide if investing in Dogecoin is the correct choice for you once you’ve given the below questions some serious thought.
- Have you thoroughly mastered the principles behind cryptocurrencies to make an informed decision?
- How much money and for how long are you planning to invest in cryptocurrencies?
- Are you prepared to lose all of your investment in cryptocurrency, which is usually risky?
Here are some essential aspects to think about before investing in Dogecoin.
1. Recognize the true worth of buying Dogecoin
It will be challenging, time-consuming, or downright impossible to determine the true worth of a digital asset.
If you’re sure about buying this asset, you can instantly buy Dogecoin with a credit card, bank transfer, or using local currency via your bank account in more than 150 countries. No matter how many Dogecoins you want to acquire, you will be able to do so with the help of stringent security controls that will guarantee your safety.
2. Think about your investment goals for Dogecoin
Investing with caution is essential because online rumours claim that some investors gained large sums of money using Dogecoin. Cryptocurrencies like Dogecoin, Ethereum, etc. are speculative investments, and Dogecoin is particularly unstable because of its infinite supply. Investors must keep adding to their coin purchases for the price of Dogecoin to rise or stay stable. If not, the supply of Dogecoin quickly increases, depreciating the value of every coin currently in use.
Take into account your total financial condition, investment portfolio, and risk tolerance when choosing how much money to put into investments. Experts advise investing what you afford to lose with cryptocurrencies.
It is critical to understand that the high level of volatility of Dogecoin has made it very uncertain to predict the fate of this asset. Dogecoin’s popularity has increased as more people become aware of it and invest in it, but when these investors sell their investments as the price climbs, the price of Dogecoin falls.
Dogecoin’s price has changed significantly since the beginning of 2021. It showed a significant surge reaching an all-time high of almost $0.70. However, it quickly fell to around $0.45 and is now valued at $0.082 as of 12 January 2023.
4. Public opinion and FOMO
FOMO is a significant danger to a lucrative investment opportunity since Dogecoin is consuming the internet. Everyone is talking about investing in it. (FOMO describes the “fear of missing out” when someone decides irrationally to trade or buy in a crypto asset based on some information they have learned without thoroughly checking its authenticity or source). But before that occurs, it’s critical to keep in mind that only some achieve the same level of success as the select people who became billionaires by risking their whole money on a craze.
Investing in Dogecoin
Dogecoin will be a pleasant addition to your investment portfolio. But it’s crucial to comprehend the danger involved in purchasing this asset. Whether you’re prepared to purchase Dogecoin and grow your investment or are only beginning to dabble in the world of cryptocurrencies, there is still plenty to learn.