Why Dogecoin is going up – Is it good to invest in 2021?
What is Dogecoin?
Dogecoin is a cryptocurrency that was originally formed in 2013. Doge was built to be a friendly introduction to the concept of cryptocurrency for the general public and had a fun and friendly brand image behind it. The face of DOGE was the dog Shiba Inu, who became popular as the DOGE meme. It became a meme cryptocurrency. Nobody in the early years believed DOGE would become as valuable as it is today.
However, Dogecoin has grown in popularity because of the community surrounding it. Dogecoin has an almost cult-like status in the crypto world. DOGE helped to spread awareness about the value and importance of blockchain technology and cryptocurrency among millions of people worldwide. Today, Dogecoin has become one of the most popular cryptocurrencies. Over the past couple of days on May 3 and May 4, the price of Doge has gone up from $0.37 to 0.44 dollars, which is an 18 percent increase in the price in just 2 days.
Should you invest in Dogecoin?
Dogecoin that started as fun or experimental coin has gained a lot of ground in the last few months. Initially, it was made as a joke by Billy Markus and Jack Palmer and never really expected it to take off the way it has. The currency has gauged attention, ever since Elon Musk has been tweeting about it. Many personalities have also hinted about their vision and Dogecoin is hence making a lot of news.
Is it good for individuals to invest in Dogecoin?
To understand this, one needs to first consider certain points, including- legitimacy, history of the project, market valuation, etc. According to Kumar Gaurav, founder, and CEO- Cashaa, Dogecoin has been in the market for over 7 years now, hence, in terms of its legitimacy, there aren’t any questions. Secondly, it is said to have a defined purpose of creating a payment system that is free from traditional banking fees. So, if an investor puts money in the coin, he or she is participating in a constructive project, which forms for a good investment he states.
However, Gaurav added that this is only his personal opinion and shouldn’t be taken as any financial advice.
The real reason for the growth of Dogecoin, as per Gaurav, is its low value, which is also helpful to teach new investors about crypto and basic principles of demand and supply in the market. The industry is in its initial stages and the value of the coin will grow given the fact that a huge number of people are joining the market every day and they pick something at a low price, to begin with. Dogecoin is at a low price right now and also considerably popular. Hence, it is a good bet, but as an investor, one needs to know when to exit from it,” he affirms.
Ashish Singhal, CEO, and co-founder, CoinSwitch Kuber calls this a subjective decision. Investments in Dogecoin are like any other form of cryptocurrency and should be only be done up to an amount that one is fine with losing he suggests. Comparing it to bitcoin, Sathvik Vishwanath, CEO and co-founder of Unocoin tells that while the main reason for the invention of bitcoin is fast and free payments on the internet, the increase in the price of bitcoin and very high transaction fees that needs to be paid to get the transaction in the blockchain is one of the main reason for many to think that Dogecoin is a better alternative.
With its transaction confirmation times being less than few minutes, and every coin to be worth no more than a few rupees, Vishwanath believes it is positing itself to be the fast free transfer use-case savior while bitcoin is establishing itself as a digital gold which is meant to be like a reserve currency on the internet. The investment into this, he however warns, has appeared to be risker than investment into bitcoin based on its previous trends but the acceptance of the use case by the general public has the potential to make this coin as well a good investment.