Is Dogecoin a Millionaire Maker?

Popular meme coin Dogecoin (CRYPTO: DOGE)has been a good or bad investment, depending on when you bought it. The cryptocurrency is remarkably up over 28,000% over its lifetime but is down more than 80% from its peak in 2021. Yet, had you bought Dogecoin a year ago, you'd be up over 60% today. In other words, Dogecoin might be the most volatile thing you could invest money in.

Given Dogecoin's huge swings, who am I to say that it can't make investors rich? However, just because something is possible doesn't mean it's likely.

Dogecoin's impressive lifetime returns can seduce risk-seeking investors, but this is an illusion you should avoid.

Here is what you need to know.

Dogecoin is too volatile

Generally speaking, the more risk you take, the more potential reward you get. After all, if life-changing investment returns were easy, everyone would do it. Theoretically, investors looking for significant returns should be comfortable taking on some risk, traveling the bumpier road in pursuit of a better destination. But Dogecoin takes this to an extreme that most people probably can't tolerate.

You can see below that Dogecoin has spent most of its existence trading between 40% and 80% below its all-time highs:

Perhaps the most brutal truth is that Dogecoin doesn't have intrinsic value. Unlike stocks, it has no underlying business or assets that might justify someone paying a higher price. Dogecoin's price depends on how much people want it versus its availability. Dogecoin could easily go forever without sniffing its former high again.

Why might Dogecoin never reach its highs again?

It boils down to two problems with the cryptocurrency itself.

First, Dogecoin is a meme coin created as a lighthearted way for people to learn how cryptocurrencies work. Some merchants have adopted Dogecoin as a form of payment, but it's minimal. It would be hard for enough people to take Dogecoin seriously enough to accumulate it without more widespread adoption. Additionally, the meme coin's intense volatility makes it harder to adopt since almost all companies sell goods and services with costs denominated in fiat currency.#bitcoin #BTC #Binance #BNB $DOGE