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Decoding Dogecoin: Is the meme coin worth a serious investor’s time?
Investors continue to wait for Dogecoin’s next big rally. Will it come?
In the cryptocurrency market, there is arguably no more polarizing topic than meme coins. Simply put, you either love them or hate them. Some see them as a fun get-rich-quick opportunity, while others see them as speculative investments with no real value.
This is true even for meme coins with multi-billion dollar market caps, such as Dogecoin (DOGE -9.18%). This dog-themed meme coin has been around since 2013 and now has a market cap of over $17 billion. Just like Dogecoin Does it deserve a place in your portfolio or not?
Dogecoin is no longer the hunting dog
Until Shiba Inu (SHIB -8.74%) Launched in August 2020, Dogecoin reigned supreme as the leader of the meme coin universe. When people talked about meme coins, they were talking about Dogecoin. Dogecoin has built up a tremendous amount of public goodwill during this period, and during the latest crypto market rally, it even attracted the support of billionaire Elon Musk.
Image source: Getty Images.
But Dogecoin isn’t just a hot dog anymore. There are thousands of meme coins to choose from. There are celebrity meme coins, presidential candidate meme coins, and meme coins for just about any type of animal you can think of. Even if you want to invest in a “classic” dog-themed meme coin, you have plenty of options.
Dogecoin’s best days are behind it
Simply having more options when it comes to meme coins wouldn’t be a big deal if Dogecoin was still performing stellarly. But the sad fact is that Dogecoin’s best days are behind it. In its entire 10-year history, it has never traded above $1. Aside from a brief spectacular run in 2020-2021, Dogecoin has disappointed investors, time and time again.
Just look at this chart of Dogecoin’s performance over the past five years. Dogecoin’s price peaked in May 2021 when Elon Musk appeared on NBC’s Saturday Night Live. In one of his comedy skits, the so-called “Dogefather” jokingly admitted that the meme coin was nothing more than “a scam,” and Dogecoin’s price never recovered.
It’s true that there are occasional signs that Dogecoin may be making a comeback. But consider how Dogecoin has performed this year amid a new meme coin rally in the cryptocurrency market. Dogecoin is up 32%, but Shiba Inu is up 60%. Pepe (PEPE -15.10%) — a frog-themed meme coin — is up 692%. And dog hat (Married woman -14.90%) — another dog-themed meme coin — is up a whopping 1,171%.
All of these meme coin competitors have market caps of $2 billion or more, so it’s not that easy to dismiss them. Yes, they have silly mascots and names. But if your sole goal is to “get rich quick,” they’re probably better options than Dogecoin right now.
Is there any serious reason to invest in Dogecoin?
When it comes to meme coins, just be careful about chasing performance. It can be tempting to invest in a meme coin that is rising in value. But meme coins can go to zero overnight and should not be part of a long-term portfolio. If you’re going to invest in meme coins, you need to be prepared to lose everything. Think about all the Dogecoin investors who bought in at the market top of $0.74, only to be stuck with an investment that is currently worth just $0.11.
That said, there is one scenario where Dogecoin could be worth a serious investor’s time: if Elon Musk decides to go all-in on Dogecoin for his companies. For example, in March, there were hints that he might be considering making Dogecoin a payment option for Tesla electric cars. And early last year, speculation began that Elon Musk might be ready to make Dogecoin a payment option on social media platform X.
But as is often the case with meme coins, the buzz and speculation are far more entertaining than the day-to-day reality. Until something drastically changes with Dogecoin, it’s best to look elsewhere for a crypto investment opportunity.