Dogecoin: Billionaires, celebrities, and athletes can’t get enough of the crypto craze. Tesla CEO Elon Musk thinks digital currencies are here to stay. So does investor and Dallas Mavericks owner Mark Cuban. They’re not alone. Rapper Snoop Dogg jumped on the Dogecoin bandwagon along with Kiss singer Gene Simmons and restaurateur Guy Fieri after the meme-inspired cryptocurrency surged a whopping 10,000% this year. READ MORE: Here’s How to Buy Bitcoins in India?
Athletes are also flocking to bigger cryptos like bitcoin and ether following a record-breaking rally. Trevor Lawrence, the No. 1 NFL draft pick in 2021, partnered with a global cryptocurrency investment app called Blockfolio and plans to place his signing bonus into an account with the company.
Dogecoin was invented about 6 years ago as a joke or meme and was capable of providing free and fast transactions. However, with time many famous personalities started commenting positively on this, which brought in humongous traction followed by the price increase. As for investing in this cryptocurrency, experts say that it is quite risky.
According to Kumar Gaurav- Founder and CEO of Cashaa- a crypto-friendly neo-bank, projects such as doge coins are launched with a vision to address a prevailing problem and expect the investors who share their vision to trade. However, Gaurav says that some step into this just to get quickly rich, and this approach leads to them getting their hands burnt. This is a gold digger attitude and is not appreciated in any investment trading field. For some new investors, Gaurav believes, it might be even complex to understand the projects and the procedures for investment.
In a case like this, they begin with small and affordable coins. “The challenge might be for those who again are investing huge amounts beyond their capacity, without any understanding of the market. They should always remember that all the markets, be it share market or crypto assets, fluctuate,” Gaurav explains. According to Sathvik Vishwanath, CEO and Co-Founder of Unocoin, dogecoin presently does not have a strong developer community which again makes this investment risky.
“The risk-taking investors really need to be aware of the market conditions as the premise before getting into this,” he advises. Some also point out that dogecoin is literally a meme coin so it can be extremely volatile at times. Additionally, the most significant risk in investing in any cryptocurrency is that they are neither regulated by RBI nor have a statutory body to oversee their operations. At times, the central bank has issued several warnings for crypto traders of possible losses due to adverse developments.