What’s the common thread between joke cryptocurrencies like Dogecoin and (CRYPTO: DOGE) Shiba Inu, (CRYPTO: SHIB), and actual serious cryptocurrency investments like Solana (CRYPTO: SOL)? There’s more than one right answer.
But one of those answers in particular is especially salient for those who are praying that their investments go up. Let’s take a look at one number that suggests there’s a real chance of that happening.
According to a survey of 800 people conducted by the Kraken cryptocurrency exchange and published on Feb. 19, 85% of crypto holders in the U.S. are invested in at least one meme coin. That’s a shocking number because it implies that the large majority of crypto investors are comfortable taking extreme risks.
But that’s not all Kraken’s survey found — 29% of those same people said short-term gains were their main motivation for investing, and 76% said that the potential upsides justified the risks of an investment in these highly volatile and highly speculative assets. In a nutshell, roughly a third of the investors are, to put it bluntly, incorrectly oriented in terms of their strategy, seeking quick riches rather than sustainable portfolio growth. As long as that belief remains true, those meme coins could have plenty of upside, at least before they come crashing back down as they always do.
And, while it’s true that it is technically possible for meme coins to skyrocket and deliver big returns to early holders who subsequently sell their tokens before the crash, that doesn’t mean that investors are correct about their balance of risk and reward on average. Nor is it true that most will be able to time their sale correctly.
Still, the survey shows precisely why it’s possible for assets like Dogecoin and Shiba Inu to go to the moon once in a while. When enough new money comes off the sidelines to take a gamble with long odds, the results can occasionally be impressive, even if it’s impossible to predict when and why they’ll happen. Crypto assets upstream from meme coin investments, Solana in particular, are also exposed to the same kind of skyrocketing.
You do not need to invest in meme coins simply because most other investors are doing it. Your results will likely be better if you stick with simply buying Solana, as most meme coin investing activity occurs on its blockchain, meaning that other investors will need to buy it first before they can gamble on those tokens.