Dogecoin, Safemoon, Cumrocket: What the hell is going on with cryptocurrencies?

@EQUITYMATES|14 May, 2021

You’ve probably heard recently – cryptocurrencies are having a moment. We’re all having flashbacks to 2017 when cryptocurrencies were all that was discussed in group chats and Facebook groups. But 2021 is putting 2017 to shame. If you’ve got no idea where to start with cryptocurrency in 2021, here’s a brief explainer. 

2021 is 2017 on steroids

The first thing to know is that 2021 is bigger than 2017. In 2017, Bitcoin – the OG cryptocurrency – reached almost $20,000 USD for 1 coin. Then, in ealy 2018, fell about 90% and ended up around $2,000 for 1 coin. A lot of people lost money, sold their cryptocurrency and thought it was all over. But after a few quiet years, Bitcoin is back and bigger than ever. This year, we’ve seen Bitcoin reach as high as $60,000 USD for 1 coin. 

The total value of all cryptocurrencies is about $2.25 trillion. Bitcoin alone is worth over $900 billion. These are big numbers and tough to imagine. So here’s some comparisons to put them in context. 

  • Australia’s largest bank, Commonwealth Bank, is valued at $170 billion
  • The United States’ military spending is $800 billion per year
  • Facebook is valued at $850 billion
  • Australia’s GDP is $1.4 trillion per year
  • Global military spending is $2 trillion per year
  • Apple is valued at $2.1 trillion

Bitcoin is more valuable than Facebook. All cryptocurrencies are more valuable than Apple. There is more money in cryptocurrencies than the every country combined spends on their militaries. That’s the scale we’re talking about with cryptocurrencies in 2021.  

Crypto is becoming more mainstream

As cryptocurrencies become bigger, governments and companies are starting to adopt them. There has been a string of companies that have bought Bitcoin – Tesla, MicroStrategy and Square amongst them. At the same time, governments are looking at adopting cryptocurrencies. A term you’ll likely come across more and more is Central Bank Digital Currency or CBDC. This is how governments are looking to adopt the technology underlying cryptocurrency and create digital versions of their existing currencies. For example, China is looking at creating a ‘Digital Yuan’ which would be a digital version of the normal Chinese currency deployed on a blockchain. 

This mass adoption of Bitcoin, Ethereum and the blockchain technology that underpins them, means that Bitcoin and Ethereum are likely here to stay. Who knows what they’re worth or how much they’ll be used, but these two cryptocurrencies are going mainstream. 

It’s really easy to make a cryptocurrency

Bitcoin and Ethereum are not the only cryptocurrencies out there. There are over 4,000 cryptocurrencies in the world and there are more being created every day. Here’s the scoop – it’s really easy to make a cryptocurrency.

There are websites that allow you to make a cryptocurrency in just a few clicks. Some of these cryptocurrencies are made by legitimate businesses or entrepreneurs for legitimate reasons. Others are made as a joke. The most famous joke cryptocurrency is Dogecoin. Dogecoin was made in 2013 as a way to make fun of cryptocurrencies. It now has a market value of $65 billion USD. 

These alt-coins are having a moment

You’d think that people wouldn’t want to invest in cryptocurrencies being made as a joke with names like Cumrocket or Yeet. You’d be wrong. It seems there are people that are willing to invest in anything cryptocurrency related and the prices just keep going up. These alt-coins (aka joke-coins, aka shit-coins) are having a moment. 

Some of the most famous alt-coins are rocketing up in value.

  • Dogecoin – $65 billion
  • Safemoon – $4.5 billion
  • Cumrocket – $162 million

We had a bit of fun and looked for some of the stupidest cryptocurrencies out there. 

  • Yeet Token 
  • Poo Coin 
  • Elongate 
  • Coinye West
  • Trump Coin 
  • Putin Coin 
  • Meth Token
  • Cat Coins
  • Garlic Coin

You can’t look at that list and think cryptocurrency isn’t in a bubble at the moment. There is so much money flowing into coins that have been started as jokes or as scams (there is literally a cryptocurrency called SCAM coin…). 

Yet, people are making so much money in these alt-coins. There are literally Dogecoin millionaires. People have made life changing amounts of money investing in something that was explicitly started as a joke. It’s hard not to get FOMO when reading that. 

What’s an investor to do? 

As an investor, the first thing to do is steer clear of the world of alt-coins unless you’re willing to lose everything you invest. Sure, you might make a quick dollar picking a random specky coin. But that’s all it is – random. There’s just as much chance you lose everything you invested as you make any money.

Bitcoin and Ethereum look like they are becoming more mainstream, but they are still extremely risky assets to invest in. Bitcoin has fallen 90% once before, it could easily do it again. 

At Equity Mates, we like dollar cost averaging into the stock market and take a similar approach with a small part of our portfolio into Bitcoin and Ethereum (we cannot stress this enough, a SMALL part). We use Bamboo, a microinvesting app for Bitcoin and Ethereum (no buying Dogecoin or Coinye West on this app). 

Every time we make a purchase, Bamboo rounds up the purchase to the nearest dollar and invests in Bitcoin and Ethereum. For examples, a $4.50 coffee gets rounded up to $5 and that extra 50 cents gets invested. For us, its an easy way to get a little bit of exposure to the two major cryptocurrencies without having to wade through all the Trump Coins and Meth Tokens out there. 

If you want to get started with Bamboo, search Bamboo in the app store or head to GetBamboo.io. After you’ve signed up, head to settings, and enter the promo code ‘equitymates’ for $10 in free Bitcoin.  

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