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Floki Inu Is a Highly Speculative Meme Crypto Based on 2 Tweets by Elon Musk

Elon Musk named his Shibu Inu dog “Floki.” He tweeted about it on June 25 when he named it and tweeted again on Sept. 12 when Floki arrived at his house. Within minutes Floki Inu (FLOKI-USD) crypto shot up 100%. As a result, the FLOKI crypto now has a market cap of just $1.33 billion and is ranked as 2,713 in terms of market cap by Coinmarketcap.com.

chart of cryptocurrency
Source: Shutterstock

Now, according to the Financial Times, there is a huge advertising campaign in the UK especially in subways:

“Adverts with the slogan “Missed Doge? Get Floki” have appeared across Underground stations, trains and buses in the UK capital in recent weeks to drum up enthusiasm around Floki Inu coin.”

Are you not entertained? That is what I am thinking here.

The Thinking Behind This New Meme Coin

This is beyond ridiculous. The crypto is typical of what is now called a “meme coin.”  That is, it’s a crypto with no meaning, no purpose, no raison d’être, other than that it’s designed to take advantage of a craze.

In this case, the craze is simple: if you missed the huge gains in Dogecoin (DOGE-USD), which Elon Musk also backed, now you have a second chance with FLOKI crypto.

After all, DOGE crypto now has a market value of $31.1 billion and is ranked as the 11th largest crypto out there, according to Coinmarketcap. It started out as a meme coin, too. So, who knows? Maybe Floki crypto has a chance as well.

How to Think About Investing in FLOKI Crypto

Anyone who is going to put any kind of money into their meme coin has to carefully consider that it is “lost” money. Maybe a more positive way to think about it is to compare it to your own entertainment budget.

For example, I like to play poker, and other games, including craps. I have a set amount of money that I can budget for this kind of entertainment, even though I know the “house” has an advantage (except for blackjack, in certain circumstances that I can control as a card counter). But, by and large, the money set aside is for entertainment and essentially “lost” or let’s say “spent” on entertainment.

The same should apply to anyone essentially committing any kind of capital to buy FLOKI crypto coins. Consider the money essentially lost down the drain. You will gain entertainment value by hoping the crypto will essentially skyrocket as Dogecoin did at one point. But the odds are against this happening.

To be more precise, this is also what is known as a “greater fool” theory coin. The only way you can hope to make money by investing in this crypto is by selling it at some point to a greater fool than yourself.

Don’t Believe the Hype

So, the best way to invest in FLOKI crypto is to essentially budget an amount you are willing to lose. Don’t try and delude yourself with some kind of rationale that the crypto actually will have some fundamental value.

Here is what a number of Floki crypto supporters said in September on Medium, a popular blog site:

“To keep momentum moving, Floki Inu is assaulting the market with very targeted and aggressive marketing campaigns. Floki Inu has already contracted to spend almost $1,500,000 in marketing.”

The ads started in October in London and are also up in the Los Angeles area for the next three months. The whole point is to try and “legitimize” the coin, as the FT editorialized.

That’s not the type of investment security that has a fundamental purpose. It’s more like a sort of Ponzi scheme, at best.

The bottom line is: buyer beware. FLOKI crypto is only for those who have a speculative bent, and are willing to lose the money.

On the date of publication, Mark R. Hake did not own any security mentioned in the article, directly or indirectly. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.

Mark Hake writes about personal finance on mrhake.medium.com and runs the Total Yield Value Guide which you can review here.

Article printed from InvestorPlace Media, https://investorplace.com/2021/10/floki-crypto-is-a-highly-speculative-crypto-with-no-underlying-value-or-purpose/.

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