The crypto sector has changed a lot in the last 4 months and it is becoming a very dangerous investment for those who are new to this world. Why? Simply because in the last few days we have seen absurd price rises on projects that certainly don’t deserve it. All this thanks to the hype created ad hoc by organized groups that make promises that are almost impossible to keep. Like DOGE at 1 Dollar, SafeMoon at 0.01 cents and so on. Of course, we are not against these projects and we like SafeMoon for example, but today we want to explain why NOT to invest in such projects after they have already gone up 50-100-1000 times.
The marketcap of DOGE and SAFEMOON is extremely HIGH.
The main reason why it is wrong to invest your money in DOGE or SAFEMOON is that their marketcap is extremely high, definitely out of the ordinary. To give an example, DOGE at the moment, with a listing of about $50 billion, is valued higher than many companies that have been up and running for years such as: FORD (48 billion), Marriott hotels (49 billion), Barclays (44 billion) and many others. In terms of market cap, it is also higher than respectable crypto projects that generate millions of dollars on an annual basis such as UNI, LINK, XLM, VET, SOL etc. In short, how can a project that has no business be worth more than companies that make millions if not billions of dollars in net profits per year? All thanks to HYPE.
When Elon Musk, Snickers and many other VIPs and famous companies tweet about DOGE, the new crypto investor believes that the token will continue to rise indefinitely. Unfortunately, this is not the case, even though DOGE is a very nice project and one of the best ways to increase crypto adoption, the situation that has been created is very reminiscent of various ponzi schemes. The token will continue to rise as long as there are new buyers and lots of hype, but eventually, it is bound to fall sharply, causing those who bought at extremely high prices to lose millions or billions of dollars.
The same applies to SafeMoon, a project with around 700,000 token holders that is setting records every day. SafeMoon is a project with an EXCELLENT token economy but currently has a market cap of around $9 billion. Once the new buyers are gone, how will it be possible to justify such a high value of a project launched only 1 month ago that at the moment only has a website and a nice design? There is no logical explanation that holds water. Investing now in SafeMoon, SafeMars, Shib, Hoge or other tokens with trillions of units and prices of a few thousandths of dollars can be DANGEROUS.
Do NOT trust VIPs who tweet about cryptocurrencies
If a VIP loves a cryptocurrency and tweets about it, don’t assume that’s the only reason that token will go up. Maybe it will go up in the first few hours after the tweet, but then the next day it will return to its starting price. In short, a classic pump and dump. Justin Sun has even paid VIPs last month to tweet about his projects, but after an initial pump, they started to fall again. Do not be influenced by VIPs for your crypto investments and forget about the stories of becoming a millionaire by investing a few thousand dollars (or even hundreds of dollars). Someone you know may have done it, but millions of other people will do the opposite: they will lose everything!
Invest your money wisely in projects that are destined to do big things like Bitcoin, Ethereum, Chainlink and so on.