Many people think Dogecoin will be the next big investment after Bitcoin and Ethereum. And they think this because Elon Musk invested in that. But I think Dogecoin doesn’t have that potential. Why? Let’s see those factors that make Dogecoin a bad investment.
Unlimited Coin Supply
We all know that Dogecoin is a well-known crypto coin, and many influential investors have invested in Dogecoin. But I think it’s a waste of investment. That is because it has an unlimited supply of coins. I mean, it doesn’t matter how much you want. You can mine as much Dogecoin as you want. That will lead Dogecoin to inflation. At the same time, the unlimited supply nature of Dogecoin will make it a low-demand asset, and since the demand will remain constant and the supply will go off the roof, so the price of Dogecoin will go lower day by day.
Technological Aspect
Crypto, will do better, depending on the technology that uses and the updates of the technology. It has used the same technology that has been used to create Bitcoin and Ethereum. But here’s the catch, which is Bitcoin and Ethereum are constantly updating their system and technology. On the other hand, Dogecoin has never been updated since 2015. So, the technology has remained the same as in 2015. So, how will Dogecoin do better in the future if its technology hasn’t been updated for that long, and how will it cope with other cryptos?
Abandoned by Developers
As I mentioned above that Dogecoin hadn’t been updated since 2015. But in 2020, Elon Musk invested in dogecoin, and since they are working on the Dogecoin. However, it’s a fact that the developers had abandoned Dogecoin for a long, and that makes sense that developers don’t have faith in their Dogecoins, so there is no potential and hope for Dogecoin. Developers are serious about Dogecoin now because a celebrity investor, Elon Musk, has invested in it. And if Elon musk sells all his Dogecoin holdings, then the developers will have no other option but to abandon it again.
Don’t Have a Good Reputation
We all know that dogecoin and other Litecoin are created for jokes and memes. These are created so that people can mock and make jokes about Bitcoins. But they have done well since then. However, Dogecoin has been in the market for a long time, and still, the kit hasn’t grown that much like Ethereum and Bitcoin or even Cardano. On the other hand, since it was created for funds, people won’t take it seriously and invest in it, and that won’t be good since no investment means no added value. Besides, it hasn’t gotten the attention of investors that Bitcoin and Ethereum does. However, people have believed in Bitcoin and Ethereum, and that’s why they invest their money in those. But they don’t have that much trust in Dogecoins.
Volatile
We all know that cryptocurrencies are extremely volatile. But Dogecoin is more volatile than other cryptos. That is because Dogecoin has an unlimited coin supply, and people can mine as much as they want. It leads Dogecoin to inflation. And instead of a price rise, its prices fall constantly.