Bitcoin (BTC) proponents are a pretty enthusiastic bunch these days. The approved ETFs have turned out to be a great success and the leading crypto has gained 152% over the past year. Additionally, the Bitcoin halving event is only days away now (whereby the rewards for mining BTC get slashed in half) and could act as another catalyst for further gains.
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As is customary, it is not only Bitcoin that has been gaining ground; some of the crypto space’s more speculative assets have been catching a ride on its coattails. That includes the leading meme coin, Dogecoin (DOGE). The dog flavored token is up by 122% year-to-date, which begs the question: should you get on the Doge train or is it not worth the time of day?
Stay away, is the advice of top investor Neil Patel. Patel concedes that part of Doge’s big gains have been down to a “potential catalyst” in the shape of rumored acceptance as a payment method for advertisers on X (recall, Doge’s most high-profile fan is Elon Musk). But while the investor “applauds the possibility” Dogecoin will be accepted as a valid payment mechanism given it will result in “actual utility” for the digital asset, he’s skeptical it will really be commonly used for that purpose. And while Doge can be used to purchase Tesla merch and the Dallas Mavericks even permits ticket and merchandise to be sold in exchange for Dogecoin, he views these more as marketing ploys companies use to bring attention to their products.
Essentially Patel’s main gripe is that when you consider Doge’s history, it is rather obvious its trajectory has been defined by “nothing more than periods of exuberance and pessimism.”
“Therefore,” Patel goes on to say, “only people who believe that they can correctly time the market and predict when upswings will occur should look at Dogecoin. To be clear, this isn’t investing; this is trading. And there are very few people that can do this successfully, so it’s best to avoid this activity altogether.”
Nevertheless, Patel believes the primary motivation for purchasing Dogecoin should rest on the belief that in a decade or so, it will experience significantly wider acceptance and utility. “I’m not so optimistic about this outcome,” the 5-star investor opined.
Here’s an example why Patel is not convinced. Say a particular blockchain network boasts a robust developer community dedicated to its advancement, then it increases the prospect of sustained success. With ongoing upgrades and new features, the platform evolves over time. Yet, per an Electric Capital report, Dogecoin counted 19 active developers contributing to it as of December 2023, placing it 90th among the top 100 blockchains. “This doesn’t bode well for its future,” Patel summed up. (To watch Patel’s track record, click here)
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Disclaimer: The opinions expressed in this article are solely those of the featured investor. The content is intended to be used for informational purposes only. It is very important to do your own analysis before making any investment.
