In the last week in January, Redditors caused Gamestop’s stock to surge to more than 100 times from its 52-week low.
Who wouldn’t want to turn 1 dollar into 100 dollars or 1,000 dollars into a cool 100k?
I mean, it seems legit.
What could possibly go wrong?
So when my social media feed became flooded with memes about a cryptocurrency called “Dogecoin”, I did the only thing a responsible adult like me could do.
I opened my wallet.
UPDATE (May 4, 2021): Shortly after I finished this article, I was able to buy some Dogecoin. It has now gone up by more than 1,000% in less than 6 weeks. It’s amazing how quickly the Dogecoin world is changing in 2021!
What is Dogecoin?
I may be gullible, but I’m not an idiot. I wasn’t going to invest my money in something I knew nothing about. So I did some research about Dogecoin.
Most importantly, I had to learn if it was pronounced “Doggie coin” or “Dozh coin”.
I quickly learned that people pronounce Dogecoin as “Dozh coin”. Which is clearly a missed opportunity on their part since Dogecoin is synonymous with pictures of dogs making money. Shiba Inu dogs to be exact.
(Honestly, I prefer greyhounds anyway, so I’ve got two strikes against what should be called “Doggie coin” at this point. But whatever, it’s my ticket to infinite riches, so I’ll roll along with this scheme).
Furthermore- in doing my “market research” on Wikipedia I also learned that
- The cryptocurrency was invented as a joke
- Dogecoin have essentially no use in real life
- Dogecoins values have fluctuated wildly after coordinated buying attempts in 2017, 2018, and 2021.
After I was satisfied that I had learned everything I needed to know about Dogecoin, my next step was to buy some of this stuff and then get rich.
Should a finance blogger really recommend buying Dogecoin?
Let’s get a few things straight. My blog is my personal thoughts and not investment or legal advice. And this blog post was about my own personal attempt to ride Dogecoin “to the Moon”. Please do not buy Dogecoin after reading this post.
Furthermore, my Dogecoin phase wasn’t about investing for retirement. Mostly, I was just in need of a quick dopamine hit.
I don’t smoke, I don’t drink, and I don’t do drugs. Really, I’m a boring person.
But now and then I like to gamble a bit. Mostly with betting on sports or making prop bets. For the record- my favorite prop bet is betting on the length of the National Anthem during the super bowl. Even though bookies set the line at an insanely long time each year.
I always “take the over”- because let’s face it, what singer doesn’t like to add every ornamentation possible to the word “free” with an audience of 140 million people.
Unfortunately, the legal framework for prop best in the US is dodgy at best. If I lived in the UK, I could bet on whether a 300 pound goalkeeper would eat a pie during a soccer match. That’s a *much* more exciting bet than the National Anthem.
While I don’t recommend gambling, and I definitely do not recommend breaking US law, my prop bet affinity has definitely primed my pump for thinking about Dogecoin.
Dogecoin as an investment
So I know I was just saying I viewed Dogecoin as a legal prop bet. But have you read any of the social media surrounding Dogecoin. They very clearly always use the word “invest”.
I guess this is where the internet expects me to pontificate on whether Dogecoin can really be an investment?
If I were a real FIRE blogger, I’d say something like owning stocks is owning part of a real company that makes real profits. And then I’d say that speculation and volatility don’t matter because humans are greedy and their natural ingenuity drives them to make profits. Yada yada yada, VSTAX, index funds are a slam dunk. Amen.
After explaining why stocks have value, I think I’m supposed to tell you why cryptocurrency is worthless. Crypto does not have any intrinsic value. Nor does crypto represent ownership in a profit generating enterprise.
When you buy a bitcoin or an ethereum or a dogecoin you’re buying a digital piece of property. Most cryptocurrencies have a fixed supply. If you buy cryptocurrency as an investment, you hope that more people will want your cryptocurrency in the future. Since the supply is fixed, an increase in demand will mean an increase in price.
Where else you gonna put yo’ money?
But let’s get real. Like 2021 real. Are stocks really going up in 2020 because businesses are profitable? Unless your business is called Amazon or Pfizer, I’m guessing you didn’t have a profitable 2020.
Stocks are going up because there’s nowhere else to put your money since the great recession. After 2008, the Federal Reserve slashed interest rates to pretty much zero where they’ve stayed ever since. In simple terms our Government made stocks the only option.
If you have heaps of cash and need a place to put it, you almost need to put it in the stock market if you don’t want to lose money. Look at the returns on bonds over the past 5 to 10 years– they didn’t beat inflation.
Businesses, pension plans, and personal savings have nowhere else to go besides the stock market. At a PE ratio of 37, it’s pretty hard to argue that the rise in stocks is a result of “human ingenuity”. (Unless the human ingenuity is a euphemism for negative interest rates and investment banking).
All this is to say, is that as finance bloggers, we don’t bat an eye telling people to buy overvalued pieces of paper called stocks. But heaven forbid we encourage people to buy overvalued pieces of paper called bitcoin.
(Honest disclosure, I’m 100% invested in equities. And I think in the long run, they’re the safest best-bet. And I’d like to reiterate here that I’m just a random clown on the internet and I’m *not* dolling out investment advice)
Dogecoin as a prop bet
Right-o. Back to my story. So while I can’t quite recommend Dogecoin as a serious investment, it did pique my interest as a prop bet.
Lots of prop bets are essentially double or nothing. While doubling your money is cool and everything, Gamestop, AMC, and Dogecoin were growing by a factor of 100!
Let’s math that out: 100x > 2x
To get 100x odds on something in Vegas, you’d need to do what’s called a Parlay. You’d need to place a bet on 8 consecutive 50:50 outcomes to come out in your favor to get 150:1 odds. (This is an extremely dumb bet because the odds of an 8 team parlay are (1/2^8- a 256:1 occurrence).
So I sized up my odds. Are the odds of Dogecoin “going to the moon” higher than the Dolphins, Bills, Packers, Rams, Texans, Seahawks, Chiefs, and Saints all beating their points spread in the same weekend?
Seems legit. And unlike the parlay- if Dogecoin doesn’t go up by a factor of 100, I still have some cryptobits at the end of it that I can hold on to in case Dogecoin reenters the Zeitgeist.
My foray into crypto
Somehow my phone kept pushing images of Dogecoin all day on Friday. I couldn’t get it out of my head.
At first I thought this was a dumb fad. A pump and dump scheme coordinated by someone who stood to make a ton of money off of other people.
But then, I remembered something.
And that something was “DICKS OUT FOR HARAMBE”.
It made me think that if a racist absurd meme can keep circulating on the internet for 5 years, an absurd meme about a Shiba Inu cryptocurrency will never go out of style.
Emboldened by Harambe, I set off to actually buy some Dogecoin.
While I never owned cryptocurrency before, it seemed like Bitcoin was everywhere. I could purchase it on my LINE messaging app that I use to text my friends in other countries. Likewise, I could buy some on my peer-to-peer payment platform CashApp.
I am pretty sure there is nowhere that handles money where you couldn’t buy bitcoin.
I try to buy some Dogecoin on my lunch break
So when my lunch break came on Friday, I opened up every app on my phone that I could think of and looked to see if I could buy Dogecoin. Unfortunately, no luck. (But I’ll be damned if I didn’t find multiple ways to buy Bitcoin).
I then did what any reasonable person would do. I typed “How to buy Dogecoin” into Google. The top listing was an app called “Coinbase”. I downloaded Coinbase and entered my personal information only to realize that you can’t trade Dogecoin on Coinbase.
(I was steamed)
So then I did some more Google searching, which finally led me to a website called “Binance”. I created a Binance account only to be told that I needed to use Binance.us based upon my IP address.
So then I created a Binance.US account (affiliate link).
However, before I could buy some Dogecoin, I was told I needed to upload my proof of address.
<<Did I really want to give some sketchy website proof of my address? Also, my lunch break was over. So, I tried to forget about Dogecoin for a few hours.>>
I still try to buy some Dogecoin
After sleeping on it, I decided I still wanted to buy some Dogecoin on Saturday. The good news was that Dogecoins were about 50% as expensive as they were on Friday, so I was getting my Doggie coins on sale.
The bad news was that I still couldn’t figure out how to buy Dogecoin.
In the end, I decided to risk it and upload a proof of address to Binance. Which of course, the website promptly rejected.
And by the time I was able to verify my address on Binance, Dogecoin was no longer the meme du jour.
Somehow this seems like a fitting ending to the story. An anticlimax of a half thought out prop bet.
Summary- what I learned trying to buy a doggie coin
I thought it’d be fun to buy some Dogecoin and RIDE IT TO THE MOON!
But in the end, it was harder for me to buy a Dogecoin than it was to actually buy a freakin’ Shiba Inu.
I’m not sure what this says about the Dogecoin economy. Or me as a person.
But one thing I know is sometimes the best bets are the ones you don’t place.
Got a good prop bet? Have a inside source on the National Anthem timing at this year’s Super Bowl? Did you enjoy this post so much you want to tip me in Dogecoin? Share this on Twitter & tag me.
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