English
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 Hello everyone, I am Xiaotou. In the past few days, another cryptocurrency has emerged - Dogecoin. Completely out of the circle  。 At the beginning of this year, it was only 0.03 yuan/coin； On April 25, the price of Dogecoin reached 1.82 yuan/coin. In just 5 months, it increased 59 times. Many friends also took a fancy to this "big cake" and wanted to make a profit from it immediately. However, they felt that this thing was too frothy and worried that they would be cut off as soon as they bought it, so they have been hesitant.
Today, let’s talk about it together~  First, let’s learn about Dogecoin. This started in 2013, when Bitcoin surged. Marcus, then an IBM software engineer, and marketer Palmer felt that this virtual currency without economic support had risen too crazy. In order to satirize this phenomenon, the two copied the Bitcoin code and made some modifications to it, and Dogecoin came into being. Dogecoin, similar to Bitcoin, is also an encrypted and virtual currency. We can't see or touch it, it's just a string of code in the computer. Because its logo is a coin with a Shiba Inu pattern on it, it is named Dogecoin.  However, the original intention of inventing Dogecoin was not to be hyped. Palmer, one of the inventors of Dogecoin, said: The original intention of designing Dogecoin was that the coin he developed should not become a purely speculative product like Bitcoin, but a way to express sharing and gratitude. The original Dogecoin was just a tool for people to tip. Just like if you see some excellent jokes or articles on the Internet, you can reward them with Dogecoin. But now Dogecoin has become a speculative tool like Bitcoin, which shows that it has violated the original design intention at the time.  So is Dogecoin, which has now become a tool of speculation, worth our investment? We have mentioned it before in our analysis of Bitcoin: if you want the price of this virtual currency to rise, there must be someone who is willing to spend money to buy it, that is, there must be a so-called taker.  As for the recent surge in Dogecoin, it is not difficult to find that it is related to Space X CEO Musk’s repeated calls for Dogecoin. Since the beginning of the year, Musk has posted on Twitter many times publicly supporting Dogecoin, which has also led to a sharp rise in the price of Dogecoin. For example:
It is precisely because of his repeated publicity that he attracted a large number of retail investors to enter the market. Everyone bought Dogecoin one after another, and the price also increased. Some people also joked: If you bought $1,000 of Dogecoin in early January, you might already own a Tesla.  But many people only see it as a machine for making money for many people, but ignore that it also carries huge risks. Taking the highest point on April 16 as an example, if someone bought Dogecoin here, the currency price at that time was 2.95 yuan/coin. Based on the currency price at 13:00 on the 25th, the currency price was only 1.81 yuan/coin. In less than 10 days, it had a floating loss of 38.6%.  At the same time, has anyone ever thought that the reason why the price of Dogecoin is rising now is because of Musk’s hype, but what if Musk stops continuing in the future, or does not show actual support, or turns his attention to other virtual currencies? What will be the consequences? Presumably, the Dogecoin price bubble will burst by then, and there may even be a risk of collapse. And unlike Bitcoin, a large portion of Bitcoin is actually in the hands of bookmakers. If the market maker does not ship, the market will not collapse easily. As for Dogecoin, the number in the hands of retail investors is also very large. Dispersed chips mean that it will be more difficult for prices to rise. Of course, when prices fall, retail investors want to stop losses in time, and it is easier to fall into the downward trend. This also leads to the storm being more severe than expected when the bubble bursts.  There is a big difference between currency speculation and stock speculation. If you buy stocks at a high point, and if the company is supported by good performance, the stock price will rise back sooner or later. However, currency speculation is different. Once the popularity is gone, if its price wants to rebound, it is probably a fantasy. It’s not just about speculating on coins, it’s also about speculating on shoes and stamps. Everyone wants to rely on these to make a fortune, hoping that when prices rise, others will come out to take over, but have you ever wondered whether you will be the last one to take over?   From this point of view, Dogecoin is still very risky. In fact, this also involves the difference between speculation and investment. When we invest in stocks, it reflects more of a long-term value. We study the core values behind it and the performance of the company behind it. Make a judgment on the intrinsic value of the stock price. If the intrinsic value is significantly higher than the current price, then we can consider buying it. When the current price of a stock is significantly higher than its intrinsic value, you can consider selling it. But speculation is different. It reflects more of a short-term value. For example, if someone buys Dogecoin, the buyer does not need to know how much this virtual currency is worth, nor does he need to spend a lot of time researching it. As long as someone can step forward to take over when the price is higher, allowing him to earn a profit difference from it, it is enough. Of course, returns and risks coexist. Since Dogecoin can rise 100% in one day, there must be the possibility of falling 200% in one day.  If someone makes a profit, someone will be cut off.”； As many people make a lot of money as there are people who lose everything. This is completely different in nature from your stock trading. When we invest in stocks, we buy the equity of a listed company. The company itself can continue to grow and expand through profits. Therefore, the stock itself is an "interest-bearing asset" and can generate income on its own. And what about investing in virtual currencies? Virtual currency itself does not produce any value and can only be exchanged with others, whether for money or items. In short, someone must come to take over the order before the coins in your hand can be transferred out. If one day, a black swan event occurs and the value of these virtual currencies is not recognized by the market, or there is a problem with circulation, then its reasonable market value will instantly return to zero and there will be nothing left. So in this market, everyone is betting that it will be accepted by more people in the future, betting that bigger wealthy people will enter the circle to take over the market, betting that the policy will not be tightened soon, etc. But once you get on the gambling table, you are actually handing over your destiny to others. Who can guarantee that he will not be the fool who takes over in the end? As many people become rich overnight as there are others who lose everything. It’s better not to touch this kind of virtual currency.  Okay, that’s it for today. If you think it is helpful to you, remember to "share, like, and watch" to support Xiaotou. Finally, remember to check in today~  See you next time~ Click on the card below, Follow Changtou Academy and become rich with Xiaotou! ↓↓↓  Click "Read the original text" to check in and win peripheral items! |
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