Dogecoin has emerged as a serious contender in the cryptocurrency market. Although the digital coin was based on a meme, it has seen stratospheric rises in its price over the past week. In the past four months, the current has offered solid returns rising by almost 3,000 percent meaning those who invested £500 at the beginning of the year could have a windfall of £15,000 now.
Dogecoin is a surging cryptocurrency which was created as a “joke”.
The cryptocurrency has rocketed a staggering 3,000 percent during 2021 so far.
The price of Dogecoin began climbing at a rapid rate from October in 2020, rising by almost 400 percent in that October week alone.
Dogecoin mania has spread rapidly around the globe this week after it shot to a record-high price.
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The market cap for Dogecoin tokens is estimated to be £27.99 billion ($38.72bn) which is more astounding considering dogecoin was built in 2013 as a “joke”.
Software engineers Billy Markus and Jackson Palmer decided to create a payment system that is instant, fun and free from traditional banking fees.
Dogecoin features the face of the Shiba Inu dog from the “Doge” meme as its logo and namesake.
The digital coin is now ranked the 10th largest cryptocurrency in the world and has a market cap which is worth more than Barclays and Lloyds.
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Should you invest in Dogecoin?
Investing in any cryptocurrency should be considered fully before you embark when you begin to spend your money.
Experts are split on whether it is a good time to invest in dogecoin or not.
George Chrysochou, investor and global marketing manager for Financer.com, said investing in cryptocurrency is a risk.
He told US News and World Report: “The project is community-driven since its inception and never received institutional adoption.
“It has no official road map nor a white paper. Its founder and leading developers ceased working on the project in 2015, and on several occasions, mentioned that they believe it’s overpriced.
“Without a proper team, technological development and road map, Dogecoin will likely not be a reliable investment in 2021.”
Most dogecoin investors are not buying DOGE for massive profits.
Instead, they are doing so for the enjoyment and to be part of the movement.
Many investment advisers tell those interested in investing in dogecoin to buy a small amount to reduce your risk, but enable you to enjoy the benefits of some profit.
Freetrade app analyst David Kimberley told Forbes: “Dogecoin’s rise is a classic example of greater fool theory at play, dogecoin investors are basically betting they’ll be able to cash out by selling to the next person wanting to invest.”
He added: “People are buying the cryptocurrency, not because they think it has any meaningful value, but because they hope others will pile in, push the price up and then they can sell off and make a quick buck.
“But when everyone is doing this, the bubble eventually has to burst and you’re going to be left short-changed if you don’t get out in time.
“And it’s almost impossible to say when that’s going to happen.”