Most likely you don't understand dogecoin

21 April 2021

The situation

The situation takes place in the spring of 2021.
In addition to the fact that in recent years there has been an explosion of investment in cryptocurrency and a tenfold growth of the main leaders of this market, 2021 met us with a real wave of hype around altcoins.

Against the backdrop of Tesla's founder's tweets, the cryptocurrency, founded as a joke, soared in value by hundreds of times.
While in January you could get hundreds of coins for one cent, in April one coin was already worth more than 20 cents.

Increasing hype and competent marketing have turned meme currency into real gold, bringing it to the level of Ford, Tesla and other giants in terms of capitalization.
Such a situation has a number of problems, which will make the entire cryptocurrency market storm, generating ups and downs. Often artificial.

The problem

The first and main problem of the whole situation is the huge amount of new blood on the crypto market.
Yes, investing is good, but most of these investors don't know what cryptocurrency is.
That is, they are investing in something they don't understand.
Most of them do not know even the basic rules of investing. They invest large amounts of their savings in the hope of becoming millionaires in a short period of time.
After that, the newcomer camp divides into those who get rid of assets as soon as investments show a negative trend, and those who continue to hold assets no matter what, urging everyone else to behave the same way.
Since their assets are directly currency and not cryptocurrency shares, there is a disposal problem.

Real root of the problem

There's a lot of currency on the market that people keep under their pillow.
The lack of recycling makes currency growth possible in only one form: the pyramid.
The rise in the price of the cryptocurrency that everyone is going to HODL'ie is only possible if new funds are injected into it.

That is, new investors appear on the HYIP and continue to inflate the price.
The most prominent example of such a currency right now is the dogecoin meme. This currency was created as a joke. Its purpose was to be a joke.
The abundance of hype, investors and explosive growth turned dogecoin into an object of speculation.
It is ironic that the main driver of the hype is Elon Musk, who, apparently, very clearly understands the purpose of this cryptocurrency.
All of his actions since the beginning of the year said that dogecoin was needed to hype. It's not a bad implication. Moreover, this does not negate the value of this cryptocurrency.

Imagine the situation: your entire city has agreed among themselves that from now on they will pay for goods and services with pokemon chips.
This is what dogecoin is. It's a cool joke that makes life funnier and funnier, with the chips actually remaining currency and you lose nothing.
You can still buy bread for a couple of chips and work in an office for 15 chips/hour.
This is the whole irony of dogecoin, which Elon Musk never forgot, and which investors lost a long time ago.

Fortunately for dogecoin itself, the market sharks understand the joke and don't do anything stupid.
So, for example, don't expect Amazon to introduce dogecoin payments.
Amazon is too big to have any need for PR through a hype and too serious to inflate the price of a currency that no one is going to spend at this growth rate.

Consequences

If you have agreed to pay with chips, but you hide your chips at home, expecting them to go up in price, the joke will be ruined.
Its value will fall, and you will find yourself in an unpleasant situation. Especially if you did not have time to exchange your chips for fiat currency.

Such moves in the marketplace cause both the fiat and the chips to change in price.
Likewise, the credibility of both the other jokes and the serious solutions that are trying to come to fiat's aid will be undermined.
As a result, the entire market becomes unpredictably volatile, creating spikes of 10% a day even for market leaders.
Worst of all, in the face of failed jokes, there are wannabes who play on the hype and frustration of investors who did not become millionaires.

No one knows what cryptocurrencies like SHIBA INU are until they pass the test of time or turn out to be a common scam to enrich the founders.
Circulating newbie investors and a lack of understanding of the concept of cryptocurrencies leads to unpredictable results.

Side-effects

Since altcoins are often implemented inside another blockchain (shiba is based on ethereum), the circulation of funds inside the altcoin also puts a strain on the blockchain.
This, in turn, increases miners' commissions and increases the price of cryptocurrency.

Conclusions

The summer for the cryptocurrency market can become a defining one for the coming year, and it is likely to be a disappointing outlook even with the growth of some assets.

We can only hope that the joke will still be understood correctly by the major shareholders.

Much wow and funny.

Don't take everything plain: we have to challenge and prove the information we face.

Here is what really helps me to do it.