Don't Fall for This Market Mania  | | Robert Ross
Speculative Assets Specialist | Funny how the grass is always greener... In early November 2024, my Bitcoin (BTC) investment hit 10X. That's a 1,000% gain. I've held it for seven years (although a buy at $7,933 in January 2020 would have worked as well). Normally, my fiancé and I would pop some champagne, but since we don't drink anymore, we celebrated with some ice cream. And while I was riding high for a few days, that feeling soon dissipated when I saw what was happening in the memecoin market. Memecoin Mania Is Back Memecoins are a subset of cryptocurrencies that typically have little to no inherent utility or value beyond their viral appeal. They're driven largely by hype, social media trends, and speculative trading. Think of Dogecoin (DOGE) and Shiba Inu (SHIB) as the poster children of this market. 
View larger image The latest memecoin taking over the internet is Peanut the Squirrel (PNUT). It is is named after the squirrel that was unjustly euthanized by the New York State Department of Environment Conservation in October 2024. Not long after the viral news story broke, someone created the memecoin Peanut the Squirrel (PNUT) on Solana (SOL). One "investor" who goes by the name @kkashi put $17 into the cryptocurrency. What happened next put my 10x in four years to shame. That $17 turned in nearly $3 million a month later... 
View larger image And this isn't a photoshop job. You can actually see the position in @kkashi's wallet (he has since sold the position)... 
View larger image Naturally, this story is all over the cryptoverse, as the token - which now has a $2 billion market cap - is now all the rage, with even Elon Musk tweeting about it on Twitter/X. Clearly, there is money to be made from memecoins. But should you dive into this high-risk, high reward market? My answer is simple... Why You Should Steer Clear of Memecoins I wrote the book on high-risk, high reward investing for one of the world's most prestigious publishers. But let me tell you one thing... Stay away from memecoins. I'm on record saying this cycle is not yet over. In fact, my $135,000 price target for Bitcoin (BTC) I laid out earlier this year is looking likely. That said, I would not "ape" into any memecoins as the asset class is prone to "survivorship bias." Here's what I mean... Memecoins are the casino of crypto. Yes, there are stories like @kkashi turning $17 into $3 million, but these are the exceptions, not the rule. What you don't hear about are the thousands of people who pour their hard-earned money into similar coins only to see their investments evaporate when the hype dies down. This phenomenon is what we call survivorship bias - we only hear about the rare winners because the losers fade into obscurity. For every Peanut the Squirrel (PNUT), there are countless coins that crash to zero. Here's the reality... Memecoins don't follow the same fundamentals as Bitcoin (BTC), Ethereum (ETH), or other high-conviction assets. They're driven by speculation, social media virality, and the fear of missing out. And while some traders can make a quick buck, the majority end up holding worthless tokens once the crowd moves on to the next shiny object. A Smarter Way to Play Crypto If you're tempted by the meteoric gains of memecoins, ask yourself this: Is it worth gambling your portfolio on a market that's 90% speculation and 10% luck? I don't like those odds, especially when there is so much money to be made in legit crypto projects with actual utility. Bitcoin's 10x gain over seven years wasn't a fluke - it was the result of growing adoption, increased institutional interest, and a proven use case as a store of value. Even if you're a high-risk investor, you can find better opportunities in emerging blockchain technologies, decentralized finance (DeFi), or artificial intelligence-related crypto projects. These areas have the potential for outsized returns without the same level of existential risk, and are exactly the type of cryptocurrencies we own in my Breakout Fortunes service. Sure, the idea of turning $17 into millions is enticing, but the odds are stacked against you. Memecoins are the lottery tickets of the crypto world - fun to dream about but not a strategy for building sustainable wealth. Stay safe out there, Robert Want more content like this? | | | | | | 
No comments:
Post a Comment