Why I NEVER want to make money from Dogecoin
There are a million ways to make money and I think Dogecoin is one of the worst of them
If you have been following the crypto news lately, you know how crazy the last couple of weeks have been. The price of Dogecoin reached to almost quarter of a dollar making it the fourth largest cryptocurrency in terms of market capitalization. People started uploading songs on social media saying they are gonna “take Dogecoin to the moon”. Imagine what a weird time it is to live in, where a memecoin has a greater market capitalization than most of the companies of our country. While I am writing this, Dogecoin is trading at 0.556 USD.
Now when you’re in an environment where everyone around you is investing in a memecoin and making money, it is really difficult to refrain yourself from doing so. The FOMO is real. And why wouldn’t it be? After all the Tesla boss himself endorsed this coin, right? Because if Elon says “One word: Doge”, it probably is a money-making machine. I remember my group chat flooding with messages like Aaj SNL pe Musk aa raha hai. Bhaav badhega, lele bindass which translates to “Musk is gonna be on SNL tonight, invest in Doge and you’ll make a profit”. I would be lying if I said I didn’t consider making the move, but then I thought about it for a while and realised that I would be violating the very principles that I promised myself to follow when I began my investing journey.
When you’re trying to learn a new skill, you try to emulate your idols who have a mastery in it. For eg. if I want to play a flawless cover drive, I will try to mirror Virat Kholi’s style. Similarly, in investing, I try to (or rather want to) follow Warren Buffett’s style. And if I know Buffett from whatever I read about him and his work, I don’t think he would endorse investing in Dogecoin, and rightly so. After all, it is a coin with a dog’s face on it! It has no credibility to be able to survive and grow on a long term. It relies on Musks tweets and if you have been following him recently, you know how unreliable those are. Recently he announced how Tesla will not accept crypto payments because while cryptocurrency “has a promising future, but it cannot come at a great cost to the environment”. This is the same man who made millions of dollars after his viral tweets helped the price of Bitcoin surge. Now I don’t know about you, but I definitely don’t want to put my money in an asset whose price and growth relies on someone’s social media and mood.
I’m not saying crypto is bad. I have studied some blockchain myself and I really think crypto is here to stay. I think blockchains like Ethereum are revolutionary and one should definitely consider currencies like ETH for their portfolio. But the whole cryptocurrency picture in India is very uncertain so that topic is for another day. However, I think you really need to read about stuff, have an informed opinion and then take the right decision for yourself. If you are pumping capital in something like Dogecoin based on Musk’s tweets or just because everyone around you is investing in it, take a step back and ask yourself - how different is that from putting money in a stock just because your friend said he got a tip from his random uncle who works in a broker’s XYZ firm? I think that’s the problem with people. Everyone wants instant gratification. Buffett really nailed it when he said “No one wants to get rich slow”.
The upshot? No matter how high the price of Dogecoin rises, I am never going to invest in it. I believe in putting money behind stuff that actually brings value, that is worth investing in. If you have invested in Doge and have made a profit, congratulations to you! But you just made money out of speculation and that is not at all sustainable. You will probably lose money the next time. If you have lost money, it’s not too late to exit. And if you are still skeptical about Dogecoin (like I was a couple of weeks ago), and have the urge to join the bandwagon, I’ll leave you with a final piece of investing advice from Buffett that really kept me sane and away from it-
Rule No. 1: Never lose money
Rule No. 2: Never forget Rule No. 1
