Worthwhile investment or pure lottery?

Moritz Wire: “False trench warfare”

Let’s face it, the crypto market is a lottery booth. Use cases, white papers, GitHub entries – all well and good, but anyone who pretends that these properties play a role in investment decisions is lying to themselves. Most investors in “serious” cryptocurrencies are only concerned with one thing: returns.

And that is unparalleled in memecoins. Short periods of high profits: That and nothing more remains the purpose of memecoins – and that is also perfectly legitimate. Then, when the price slumps, a “I always said so” resounds from the envious camp of know-it-alls who never miss an opportunity to demonstrate their supposed intellectual superiority over young and carefree investors who blow their horns on memecoins. to flaunt. That’s embarrassing, because everyone is perfectly clear: A Shiba Inu is not made for eternity.

One of the rules of the game is that in the end some are richer than before and the rest foot the bill. Anyone who finds this reprehensible, does not want to put themselves on the same level as the Reddit swarm or simply does not want to drag their portfolio into the dirt with memecoins is not allowed to fill out lottery tickets either. What often goes unnoticed: memecoins not only give everyone the opportunity to fill their wallets in a short time, they also contribute to broader crypto acceptance than many of the long-established coins do.

What is also often overlooked: Bitcoin would not be where it is today without the meme culture. Or where does the term “hodln” come from again?

David Scheider: “Playing with fire”

Memecoins are in a bubble – there can be no doubt about that. The market cap of the currently largest memecoin, Dogecoin (DOGE), is around $9 billion at the time of writing. Nine billion USD! For comparison: That is more than local DAX companies like Commerzbank weigh in. In contrast to coins with dogs in the logo, these produce added value for society. They provide people with loans, for example.

Memecoins, on the other hand, have no use case. They’re just memes, they’re for entertainment. That’s okay. Memecoins also have their place. But it becomes problematic when more and more people jump on the bandwagon and make so-called “Yolo investments”, i.e. bet immense sums on the inflation of the bubble. Because the bubble will burst – if you haven’t cashed out by then, you’re screwed.

Bitcoiners invest in the No. 1 cryptocurrency in the expectation that the price will rise over the long term – precisely because of the fundamental properties of Bitcoin: censorship resistance, inflation protection and network security. Dogecoin, Shiba Inu and Co. have none of these properties. Nobody plans to hold these coins for the long term. Everything that is accused of bitcoin is actually embodied by memecoins.

An investment is pure speculation. Or to put it another way: If you put your money in memecoins, you are playing with fire.

Disclaimer: This article was published in BTC-ECHO Magazine in December 2021. This way to the shop.