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Is Dogecoin Still Worth Buying in 2022?

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It’s 2022, and the cryptocurrency craze is still far from over. People are still as excited about investing in cryptocurrency as they were when these digital coins were first launched. The only difference between the cryptocurrency space of now and then is the number of choices. Earlier, people had a lesser option, so just buying a cryptocurrency would give investors a sense of greater purpose. But fortunately, it is not the case today. You cannot expect to earn good returns by randomly buying any cryptocurrency now. Currently, the market has around 16,000 cryptocurrencies, but only less than half of them are actually useful, and Dogecoin is one of them.

Seeing the Dogecoin price trends, one can find out that this digital crypto coin has been on a roll over the past few years. It is one of the meme coins that was launched with the sole intention to poke fun at altcoins but ended up being one of the most desired cryptocurrencies of all time, owing to the hype it generated among the general population. But is it enough a reason to get Dogecoin in 2022?

Well, if you’re considering buying Dogecoin this calendar year, you should be aware of its both positive and negative aspects to make a wise investment decision. We’ve curated and shared the pros and cons of Dogecoin below to make your work much easier. So let’s head quickly over to the good and bad of Dogecoin.

Pros of Dogecoin You Should be Aware Of

Since you’re planning to invest in Dogecoin, let us start with the pros or advantages of this coin listed below.

1. An Ever Growing Community of Holders

One of the biggest advantages Dogecoin has today over other cryptocurrencies is its ever-growing base of community holders. Besides a significant amount of the general public, even celebrities like Mark Cuban and Elon Musk are betting high on Dogecoin. With such a loyal following, you can be certain that the coin’s hype isn’t going anywhere around soon. Moreover, the more people join the community; the more people will be using it as a medium of exchange. A reason that led to the increase of Dogecoin’s user base and community is its investors and supporters use it as an absolute value.

2. Dogecoin’s Unique Market Positioning

An advantage exclusive to Dogecoin is its hype, wider people acceptance, and unique market positioning. Besides these things, the blockchain-based platform’s use of mining methods has earned itself some loyal fans. Currently, the Dogecoin mining method is based on the algorithm Scrypt, which is similar to that of Litecoin and is considered good by users. According to reports, approximately one new block of transactions is mined every minute on the Dogecoin network.

3. Decentralized Exchange Compatibility Gives an Extra Edge

The best part of Dogecoin is it can be transacted easily on decentralized exchanges. The Ren project has made it easier and more accessible for developers to work on the Ethereum blockchain platform while allowing everyone to access the decentralized finance network. This can result in more developers and businesses turning to Dogecoin, resulting in higher price valuation and market capitalization.

4. Supported by Most Top Crypto Exchanges

Ever since Dogecoin first received words of support from Elon Musk, its demand instantly skyrocketed. Since then, many top crypto exchanges around the world have started supporting Dogecoin by adding it to their list of supported cryptocurrencies. In fact, quite a many exchanges said much of the traffic to their exchanges was from people willing to buy Dogecoin.

5. Can be Used for Instant, Easy Transactions

Dogecoin shares quite a few similarities with Bitcoin, and it includes the security aspect and the ability to make transactions easier and quicker. As Dogecoin has no upper limit capped on its total number of coins that can be mined, unlike Bitcoin, investors find it easier to trade Dogecoin both in the long and short term.

Cons of Dogecoin Every Investor Must Know

Now that you’ve seen the fairly good side of Dogecoin, it’s time you see its bad side. To help investors like you make better, informed crypto buying decisions, we have also listed the negatives associated with Dogecoin below, so you have a complete picture from the investment point of view.

1. Association with Pump & Dump Scheme

Though prohibited on all crypto exchanges, pump and dump schemes have often influenced many cryptos, and DOGE is one of them. A pump is when a group of people together buy a significant amount of a particular coin, making its price sky-high. Once the value reaches or crosses the amount they were purchased for, they are dumped by the same group of people, leaving them with humongous profits. Some people have related Dogecoin with the same level of manipulation, so you might want to be careful before investing in it.

2. Offers Poor Technical Support

Despite having a large user and community base, Dogecoin’s technical support is poor. The coin’s technical team is not as large as that of Ethereum, Cardano, Bitcoin, etc., and there have been no relatively significant updates for a long time. All these points should be especially considered before investing, given that Dogecoin has no real utility to offer the public in general.

3. Certainly Isn’t the Best Currency to Transact In

Unlike Ether, DOGE is more of a digital currency while the former is a transactional currency. It is safe to say that other cryptocurrencies like Dash, Bitcoin Cash, Litecoin, Bitcoin, and more have better transactional value than DOGE.

4. Absence of Supply Cap

While Dogecoin enthusiasts consider the absence of supply limit to be a positive aspect, it is really not something that will go in Dogecoin’s favour in the long run. Be it DOGE or any other cryptocurrency; if it has no upper supply cap, it won’t be an ideal investment to hedge against inflation.

5. Offers No Real Life Value

When compared to Bitcoin, Ethereum, and other major cryptocurrencies, Dogecoin doesn’t really solve any real-life problem. Its entire valuation is based on the hype generated by the public and certain celebrities, in general, which is not a very good metric from an investment point of view. If the Dogecoin bubble bursts and its hype ends, the platform will have nothing extraordinary to offer, leading to its eventual deathbed.

What Next?

Now that you’ve seen the two sides of Dogecoin, you’ll be able to make better and more informed crypto investment decisions. However, before investing in Dogecoin, remember that it is and will always remain a highly speculative investment. So put your money in it only if you can handle the wild price swings and weather the constant rollercoaster storm. Not to forget, don’t make any investment without doing extensive research for safer investing options.

 

Also Check:

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