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There haven’t been many cryptocurrencies with a wilder 2021 than Dogecoin. Dogecoin’s price increased by 12,000% from the start of the year to the beginning of May. It has plummeted by more than half since then. It’s also one of the few cryptocurrencies that have become well-known. The price fluctuations and growing popularity of Dogecoin may entice you to join in. However, this coin is far from a sure thing, so ask yourself a few key questions before investing.
Here’s a quick rundown of everything you should think about before becoming involved with Dogecoin and cryptocurrencies in general. Furthermore, if you’ve already made a cryptocurrency investment and are seeking ways to further gain from it, these tips can be of help.
What is Dogecoin?
Before you buy Dogecoin, be sure you know what it is. In basic terms, Dogecoin is a cryptocurrency that is similar to Bitcoin. In 2013, IBM software developer Billy Markus and Adobe programmer Jackson Palmer collaborated to create it. It’s an alt-coin that began as a joke but has gathered a lot of traction in the last year.
Now that we know what Dogecoin is, let’s look at some factors to think about before investing. Before we get started, keep in mind that this post is not intended to be taken as investment advice. Investing in any asset, as usual, is dangerous and should only be done after thorough financial study and counsel.
5 Tips to consider before investing in DOGE in India
There is substantial research involved and multiple things to consider before investing in any crypto. Here are 5 significant factors to consider before investing in DOGE.
1. Volatility
The significant volatility of Dogecoin should be noted first and foremost. Over the last six months, Dogecoin’s price has fluctuated dramatically, reaching an all-time high of roughly $0.70. However, it soon plummeted to roughly $0.45 and currently sits at ₹14.0572 as of 29 December 2021. While Dogecoin has grown in popularity as more people learn about it and invest in it, these investors also cash out as the price rises, causing the price to plummet.
2. Influencers
Not only equities but also cryptocurrency can be influenced by well-known individuals. Elon Musk, dubbed as the “Dogefather” and “Dogecoin CEO” by the community, has frequently tweeted about the coin. As a result, its prices have risen dramatically on several occasions. It goes to reason that if a single person has the ability to impact Dogecoin pricing, things may go either way.
Musk has always been a supporter of the token, and his recent performance on Saturday Night Live was expected to drive its price near $1. However, this did not occur, as Dogecoin’s value plummeted after his performance on Saturday Night Live.
3. FOMO and public influence
With Dogecoin sweeping the internet and everyone talking about investing in it, there’s a serious risk of FOMO on a rich investment opportunity. But, before that happens, it’s important to remember that not everyone is as successful as the few Redditors who became millionaires by betting their life savings on a fad.
4. The crypto bubble
The Dogecoin cryptocurrency can be viewed as a speculative bubble that will shortly burst. However, failing to recognize it as such would cause further problems because its value swings depending on how many people own it, how many DOGE are in circulation, and how many are issued each day. If one examines Dogecoin’s price graph, the widespread expectation is that it will rise in the future, yet there is no evidence to support this. Even if someone invests in cryptocurrency, they may consider selling before the bubble bursts, but isn’t that what every investor is thinking?
5. Understanding its actual value
Understanding the real value of a digital asset can be difficult and time-consuming, if not outright impossible. You can receive a price-to-earnings ratio for most assets, which tells you how much investors are prepared to pay for a business for each dollar of earnings. This statistic might assist you in determining whether a company is overvalued or undervalued. With dogecoin, however, you’re in the dark.
Spending your DOGE
Unlike stocks, cryptocurrency holders can use their holdings to buy something. If you intend to spend your Dogecoin, there are a few places that take it.
The Kessler Collection, a luxury hotel brand, has signed a collaboration with BitPay to accept DOGE as payment at its properties. Burger Bear, situated in the United Kingdom, now appears to accept Dogecoin as payment. Similarly, DOGE can be used to pay hundreds of small businesses in the United States.
DOGE can be bought on WazirX for those who intend to participate in the latest crypto trends!
Is Pi Cryptocurrency Safe?
Pi Network (PI) is the newest digital token to catch the cryptocurrency community's interest, even before it has wholly debuted. Some users see it as a chance to get engaged in a cryptocurrency from the beginning and profit in the future, similar to how early Bitcoin adopters made huge profits by mining and keeping the coin. Other users have compared Pi to a worthless multi-level marketing (MLM) scheme.
How Cryptocurrency Works?
Cryptocurrencies use cryptography technology to keep transactions and their units (tokens) secure. Cryptocurrency works via a technology called the blockchain. A blockchain is a decentralized technology that handles and records transactions across numerous computers. The security of this technology is part of its value.
How Many Cryptocurrencies Are There?
There are over 5000 other digital currencies available on the internet in addition to Bitcoins. The only problem is that they haven't gotten the users' attention. Besides Bitcoins, a few other digital currencies have gained popularity among users. It's been more than ten years since Bitcoins were first released, and now they've achieved new heights thanks to their phenomenal success.
How To Invest In Cryptocurrency?
There are two ways of investing in cryptocurrency, mining and via exchanges. Cryptocurrency mining is considered the procedure of verifying and adding transactions to the blockchain public ledger. Another option is via cryptocurrency exchanges. Exchanges generate money by collecting transaction fees, but there are alternative websites where you can interact directly with other users who want to trade cryptocurrencies.
How Safe Are Cryptocurrencies?
Cryptocurrencies can be safe, but your crypto wallets can be hacked if proper security steps are not performed.There are also dangers and uncertainties associated with investments, and we cannot declare any virtual currency investment risk-free. Buying and selling cryptocurrencies does not have to be dangerous if the trader is well-versed in the market and treats his coins with care.
How To Invest In Bitcoin?
Bitcoin may be invested in two ways: through mining or exchanges. Bitcoin mining is carried out by high-powered computers that solve challenging computational arithmetic problems that are too difficult to complete by hand and complex enough to tax even the most powerful computers. WazirX, a Bitcoin exchange, is another alternative.
What Is The Meaning Of Crypto?
A cryptocurrency is a digital currency that is secured by the process of cryptography, making counterfeiting and double-spending almost impossible to happen. Blockchain technology is used to produce cryptocurrencies ( a distributed ledger enforced by a distributed network of computers). Cryptocurrencies are distinct in that a centralized authority does not issue them.
Is Bitcoin A Good Investment For The Future?
Some investors are afraid of the risks or devastation, but others are very eager to pursue the possibility of profit from a Bitcoin investment. A Bitcoin investment is similar to stock investing, except it can be more volatile.
Is Bitcoin Cash A Good Investment?
Bitcoin Cash is a hard fork of Bitcoin formed in 2017 to address Bitcoin's scalability and challenges. Bitcoin Cash seeks to make global transactions faster, cheaper, and more secure. Bitcoin Cash is now accepted by thousands of online and offline businesses all over the world. Studied correctly, Bitcoin Cash may be an investment worthy of consideration.
Is Cryptocurrency Legal In India?
In India, cryptocurrencies are legal; anyone can purchase, sell, and trade cryptocurrencies. They are currently unregulated; India does not have a regulatory framework in place to regulate its functioning. According to the Ministry of Corporate Affairs (MCA), companies must now declare their crypto trading/investments during the financial year, according to the Ministry of Corporate Affairs (MCA). Cryptocurrency transactions have been taxable in India when people receiving such gains are Indian tax residents or where the crypto is considered to be domiciled in India
Disclaimer: Cryptocurrency is not a legal tender and is currently unregulated. Kindly ensure that you undertake sufficient risk assessment when trading cryptocurrencies as they are often subject to high price volatility. The information provided in this section doesn't represent any investment advice or WazirX's official position. WazirX reserves the right in its sole discretion to amend or change this blog post at any time and for any reasons without prior notice.
