Dogecoin, a cryptocurrency that started as a joke, has recently gained a lot of attention and has become a hot topic among investors and traders, especially with the surge in popularity of the dogecoin stock. Despite its humble beginnings, Dogecoin has managed to grow into a serious player in the crypto world and has attracted a lot of attention from investors and traders who are eager to invest in this digital asset. In this comprehensive guide, we'll take a look at the rise of Dogecoin and the risks that come with investing in it.
What is Dogecoin?
Dogecoin is a decentralized cryptocurrency that was created in 2013 by software engineers Billy Markus and Jackson Palmer. The currency was created as a satire of the growing number of cryptocurrencies that were being created at the time, and it was named after the popular internet meme of the Shiba Inu dog. Despite its humorous origins, Dogecoin has managed to gain a large following and has become a popular cryptocurrency for both traders and investors.
How Does Dogecoin Work?
Like many other cryptocurrencies, Dogecoin uses a decentralized ledger system known as blockchain to record transactions. Transactions are verified and processed by a network of users who are incentivized to participate in the network through rewards in the form of new Dogecoin. This process ensures that the currency remains secure and that transactions are processed quickly and efficiently.
The Rise of Dogecoin
Dogecoin has experienced a meteoric rise in recent months, with its value increasing by over 1000% in the last year alone. This has been driven by a number of factors, including increased interest from retail investors, a growing number of businesses accepting Dogecoin as a form of payment, and a growing number of high-profile individuals endorsing the currency.
Cryptocurrency statistics have shown that the rise of Dogecoin has also been fueled by the growth of social media, with many users using platforms like Twitter, Reddit, and TikTok to spread the word about the currency and to encourage others to invest. This has led to a growing number of new investors entering the market and has helped to drive up the price of Dogecoin.
The Risks of Investing in Dogecoin
Despite its recent rise, Dogecoin is still a highly volatile and risky investment. One of the main risks associated with Dogecoin is its lack of widespread adoption and acceptance. Unlike other cryptocurrencies like Bitcoin, Dogecoin is still not widely accepted as a form of payment, which means that it may be difficult to convert your investment into actual goods or services.
Another risk associated with Dogecoin is its lack of regulation. Cryptocurrencies are not currently regulated by any government or financial institution, which means that there is a higher risk of fraud and market manipulation. Additionally, the value of Dogecoin is highly dependent on market sentiment, which can be influenced by a variety of factors including rumors, news, and social media trends.
The Future of Dogecoin
Despite the risks associated with investing in Dogecoin, many experts believe that the currency has a bright future ahead. With increased adoption and acceptance, Dogecoin could become a widely used form of payment and a valuable investment opportunity.
However, the future of Dogecoin will also depend on the continued growth and development of the cryptocurrency market. As the market continues to evolve and mature, new opportunities and challenges will emerge, and it will be important for investors to stay informed and to make informed investment decisions.
Conclusion
In conclusion, while the rise of Dogecoin has been impressive, it's important to approach this cryptocurrency with caution. Despite its popularity, Dogecoin is still a highly volatile and risky investment, with its value dependent on market sentiment and influenced by a variety of factors. Additionally, Dogecoin is still not widely accepted or regulated, making it a challenging investment option. While some experts believe that Dogecoin has a bright future ahead, it's important to keep in mind that the future growth and development of the currency is uncertain. Investors should be aware of the risks associated with investing in Dogecoin and should proceed with caution. It's always wise to thoroughly research any investment opportunity before making a decision.
On Wednesday, Ukrainian vice prime minister Mykhailo Fedorov announced that people can send dogecoin as a donation — a cryptocurrency that initially began as a joke but has since been supported by Tesla CEO Elon Musk.
“@dogecoin exceeded Russian ruble in value. We start to accept donations in meme coin. Now even meme can support our army and save lives from Russian invaders. $DOGE owners of the world, @elonmusk, @BillyM2k, let's do it. Official $DOGE wallet: DS76K9uJJzQjCFvAbpPGtFerp1qkJoeLwL,” Fedorav tweeted.
People can also donate to the Ukrainian government in Solana, other digital tokens based Solana, and non-fungible tokens (NFTs).
Via Twitter, Fedorov announced that Gavin Wood, co-founder of blockchain platform Polkadot, sent $5 million worth of DOT cryptocurrency to Ukraine.
On Thursday, Russia captured its first major city in Ukraine after a week of conflict. Kherson, a regional capital with a population of around 300,000, is now under the control of President Putin’s forces.
However, keep in mind that even when there are scores of people who have made a fortune trading cryptocurrency, the fact remains that the inherent risks associated with this type of trading can also leave you penniless if you aren’t careful. Every type of trading assumes some risk. It’s all a matter of managing risk and making sure that you don’t make critical mistakes. Here are some mistakes that you should be wary of.
Not Monitoring The Market
Good trades are not made based on hunches and emotions. Luck has very little to do with the success or failure of any trade. Veteran traders make trading decisions based on their technical analysis of the market. The cryptocurrency market is so volatile that even one night of bad news can cause an asset to crash overnight. It’s important to be vigilant over news and current events that could affect a particular crypto. A prime example of such events is the recent Ethereum hardforking, which caused the value of Ethereum to increase.
Trading Whenever An Asset Breaks Out
Considering the inherent volatility of the crypto market, several breakouts and breakthroughs can occur within a span of days, and even hours. While it can be tempting to wait for an asset to increase in value even further before taking profit, you’d be far better off by strictly sticking to a set take-profit level based on your technical analysis. Inversely, it’s also important that you set a stop-loss order in order to mitigate the effects of when an asset deteriorates in value.
Allowing Yourself To Be Influenced By Availability Bias
It’s normal for current events to hold influence over market conditions. In fact, social media platforms really do affect the financial markets. A good example of this is when Elon Musk tweeted his support for Dogecoin, which then caused the value of Dogecoin to spike.
While it’s acceptable to ride along with the hype generated by certain events, it’s important to know when to buy and when to sell, and this decision should be driven by historical data and accurate prognosis rather than trends and news.
Trading requires discipline and analytical skills to pull off properly. Market manipulators also bank on the availability bias to pump and dump assets for their benefit. Again, your primary tool here should be your ability to evaluate which assets are worth buying. It’s also important to identify a working time frame so you know whether to trade near-term, short-term, or long-term.
Trading is inherently risky, and these risks are only further amplified by a lack of knowledge and by poor decision-making. The information you need is readily available on the internet and through numerous software options. This is one of the many aspects that require discipline and foresight. A general rule is that if you are only starting to trade, start only with a small amount and try to master the art of trading before investing more money.
Arguably, the move is a very good one for PayPal. PayPal’s crypto play seems to have brought more users and higher transaction volumes to its platform. More users than ever before are moving to crypto, particularly younger people and millennials internationally. It has served PayPal well to get in there early.
This move was also great for Bitcoin. It certainly brought them media attention. It also helps the world see how Bitcoin – and crypto – can be made user-friendly and safe in a multitude of uses. It makes a statement to the world that Bitcoin is good, works and has use cases. PayPal’s acceptance of Bitcoin and crypto spells out in big letters to any critic claiming crypto is just for scams or crime that Bitcoin is ok.
Yet, in many ways, this move benefits PayPal more than it does Bitcoin. Bitcoin already has its users, anyone who really wanted to buy Bitcoin by now already will have done so. PayPal however has been rather static. Crypto is a new offering for its users and a new way to attract both more users and more transactions. There isn’t really a reason to check Paypal’s app on a daily or frequent basis, unless users are making a transaction. Accepting crypto means that the amount of times its users check the app – and its transaction volume – has gone up!
PayPal has around 350 million users and 26 million merchants. At the time PayPal started to accept Bitcoin transactions, in October last year, the market cap of PayPal – approximately $250 billion – was roughly the same as that of Bitcoin – approximately $240 billion. Now, PayPal’s has gone up to around $280 billion. Bitcoin, however, is currently hovering around $750 billion and has gone far past that previously. PayPal is, in many ways, replaceable. Sure, PayPal has many users and has first user advantage for the service it offers (and strong backers) but, in theory, PayPal could be replaced by another similar app with a better user experience, cooler marketing and a better brand to appeal to a bigger and younger audience. On the other hand, it’s hard to imagine that Bitcoin could ever be fully replaced. For sure, there are thousands of other cryptocurrencies, but they are simply not the same, for many reasons. Bitcoin has first mover advantage, is trust, safe, secure, has a great ecosystem of loyal (and highly skilled) supporters and developers, a big user base and is developing rapidly as well as other differentiating factors.
PayPal’s acceptance of Bitcoin and crypto spells out in big letters to any critic claiming crypto is just for scams or crime that Bitcoin is ok.
It’s not yet known how much Bitcoin and crypto holders will use PayPal to pay with Bitcoin. Generally, most Bitcoin holders want to hold on to the digital currency for the long term, in the belief that it will go up in value. Bitcoin tends to be seen as a nest egg rather than a spending pot.
PayPal’s public endorsement of Bitcoin is great. But it doesn’t change as much as one would think, either for Bitcoin, or PayPal, or traditional banking. Any merchant or user accepting Bitcoin via the app won’t actually receive Bitcoin. The digital currency will be converted in same time to their choice of fiat currency, meaning that as far as they’re concerned, they receive fiat. Had PayPal enabled its merchants to accept and hold money in Bitcoin, and to make other payments in Bitcoin, that might be a slightly different story.
PayPal has indicated they are keen to work closely with regulators and governments to ensure legal compliance in their crypto offering. This will also be true of the many other payment firms looking to accept crypto or already that have a crypto offering. This will potentially help regulators come up with ways to make it easier for other crypto related offerings to get regulated and thus be accepted and used in traditional finance. Other payments firms may also follow Paypal’s lead, making crypto the norm rather than the exception in the roster of offerings expected of traditional finance.
So is PayPal’s acceptance of Bitcoin likely to drastically change anything for traditional banking? No, probably not. The move helps win over some new users for PayPal, ups its transaction volume and increases visits to its app. This in turn could help PayPal come up with new ways to monetise its platform. It’s helped prove the legitimacy of Bitcoin, and more broadly crypto, and is another message to traditional finance that accepting crypto will become far more mainstream soon. Even if traditional banks start allowing their users to accept crypto transactions, most likely they will be cashed out into fiat in live time, just as is happening now with PayPal. Will this move be the one that makes traditional banks open up Bitcoin custody offerings to all their clients? No. Not yet, at least.
Crypto Wars: Faked Deaths, Missing Billions and Industry Disruption by Erica Stanford is published by Kogan Page, priced £14.99, available online and from all good bookshops.
Businesses today must keep up with the times to entice all customers and give them little or no reason to go elsewhere. With the world getting smaller by the day due to the internet and how it is used by businesses and customers alike, companies who aren’t riding the wave could find themselves struggling to keep up with their competitors.
The best way in which you can boost your business is to be on top of the latest technology trend and use it to its maximum advantage, and embracing cryptocurrencies like Bitcoin and Ethereum would certainly do that. However, before you decide that taking Bitcoin will make your business explode overnight, there are a few other things you need to consider first.
The rise of Bitcoin
Bitcoin is very much a hot property, as is Ethereum and, as of this moment, Dogecoin. They are in the news every day, and ‘Bitcoin prices’ is one of the most searched terms on Google. It would be easy to assume that cryptocurrencies would naturally be used to purchase goods in the same way we once used cash.
However, this is not currently the case. It is not because Bitcoin and other cryptocurrencies are not safe and secure (because everybody already knows this is not the case), but instead, it seems to be a problem of perception, which is always a critical factor in the mass adoption of anything new.
Cryptocurrency trading
While those with a decent working knowledge of Cryptocurrencies do not share this bias, there is a strong current perception (especially in the face of daily stories about the rising price of Bitcoin) that Bitcoin is something you invest in, not something you use to buy everyday items.
It could be argued that, given the current perception of Bitcoin almost as a commodity, that the person in the street is as likely to pay for a newspaper or a can of Red Bull with Bitcoin as they would using a bar of gold.
Accepting Bitcoin for everyday payments
This looks to be the main barrier in the way of accepting, for example, Bitcoin as a method of payment online. The technology should never be a problem; but instead, it is the willingness of the customer to use it.
Social media can play a significant role in this by normalizing the use of Crypto for everyday purchases. Seeing influencers using Crypto as a currency and not something that just sits in exchanges like Coinbase will increase the ability of regular users to see digital currencies the same way they see the ones they use every day.
Final thoughts
Suppose you are not sure about using cryptocurrency or feel that perhaps this is not the way forward. Just think about how customers used to pay on sites like eBay 20 years ago, which was mainly cheque or cash through the post. Paypal was not really trusted as a payment method, whereas now it is most definitely preferred and indeed requested by most if not all sellers.
Price comparison site finder.com has released its monthly Cryptocurrency Predictions Survey on how the top 10 Cryptocurrencies by market cap and three trending coins will perform in 2018.
Out of the 13 coins, finder.com’s 13 panellists predict that Dogecoin (DOGE) will experience the greatest percentage growth by December 31, 2018 (5,838 percent). DOGE was sitting at $0.003 (£0.0021) per unit on March 27, 2018, and is forecast to reach $0.1938 (£0.14) by the end of the year.
Cardano (ADA) is expected to have the second greatest increase in growth by the end of the year (812 percent), followed by Ripple (XRP) (526 percent).
Despite this growth, Bitcoin (BTC) is still expected to reign as the highest value per unit, predicted to hit $9,100 (£6,464) by May 1, 2018, and reaching $21,485 (£15,261) by December 31, 2018.
Although presently a bearish market, April is the second consecutive month that panellists have predicted no drops in value for these coins by the end of 2018, signalling optimism for future growth.
Comparing the forecast market capitalizations for Bitcoin (BTC), Bitcoin Cash (BCH) and Ethereum (ETH) – the only three of the 13 coins with reported number of coins available – Ethereum (ETH) is predicted to see the highest growth by the end of the year (234 percent). This was more than double that of Bitcoin (BTC) with a 114 percent forecast increase, and Bitcoin Cash (BCH) at 40 percent.
The 13 panellists in the April Cryptocurrency Predictions Report include:
- Alisa Gus: CEO of WishKnish, a blockchain gamified social market network aimed at helping communities grow, and founding member of the DC Digital Economy Hub
- Clayton Daniel: former tax accountant and financial advisor, author of #1 Amazon Bestseller ‘Fund Your Ideal Lifestyle’, and founder of Sprout Superannuation
- Frank Schuil: CEO and co-founder of Bitcoin-trading platform Safello. Senior adviser for businesses and associations, including CG Blockchain, Rhino Ventures and BitAngels
- Fred Schebesta: Co-founder of global comparison site finder.com, including Crypto Finder. Award-winning entrepreneur, author, mentor, and a global keynote speaker
- Jen Greyson: CEO of Powered by Neureal℠, intellectual property specialist, and named one of the Top 8 Women in Crypto
- Jörg Molt: CEO and Blockchain Specialist of the Satoshi School 1–10 Mitglieder in Bavaria, Germany
- Joseph Raczynski: Technologist, futurist, Joetechnologist.com and Reuters, technology consultant and manager specialising in Blockchain technology
- Kohei Kurihara: President of the Government Blockchain Association Tokyo Chapter. Co-founder and CMO of Collabogate, aimed at bringing people into the Crypto market faster
- Kunal Patel: Business mentor for Startupbootcamp FinTech and SuperCharger Fintech Accelerator. On the advisory panel for YES BANK
- Kyle Wang: head of business development at Hub Token, advisor and consultant to ICOs and blockchain-enabled startups
- Samson Williams: partner of Axes and Eggs, a blockchain and Cryptocurrency mining consultancy, and the CSO for Ireland-based fintech firm, SeedUps
- Sergei Logvin: Co-founder of Rocket ICO, the world’s first decentralised accelerator based on the DAO concept, advisor to Opporty.com, Project Districts, TravelChain and LibertyLance
- Tim Lea: published author and regular speaker on blockchain, the CEO of REFFIND and the director of Veredictum
The full details of the survey, complete with comments from the panellists, can be found here: https://www.finder.com/uk/cryptocurrency-predictions
Jon Ostler, UK CEO at finder.com said, “While the downward trend has continued over the past month for many coins, our panel remains bullish in a presently bearish market, signalling optimism for future growth. This is the second consecutive month where panellists are expecting no drop in value for any of the included coins by the end of 2018. While Dogecoin (DOGE), Cardano (ADA), Ripple (XRP), Ethereum (ETH) and Stellar Lumens (XLM) are expected to see greater percentage growth than Bitcoin (BTC) this year, BTC is still forecast by our panel to reach the highest value of the 13 coins, at $21,485 (£15,261) by December 31. Before considering purchasing Cryptocurrency, it’s crucial to understand that the market is incredibly volatile and will continue to represent high risk. It’s important to do your research, seek professional advice and compare your options before taking the leap into the market.”
(Source: Rooster)
