ApeCoin (APE-USD) crypto launched on March 17, 2022, and immediately started trading around between $7 and $9. Then it shot up to $16.47 on its second day of trading. Unfortunately, over a month and a half later it has fallen below that level. As of May 3, Apecoin was trading at $14.82.
The meme coin is a take on the famous “bored ape” NFT (non-fungible token). In fact, there is now a whole community called the Bored Ape Yacht Club, built around the popularity of this NFT series. That is how the Apecoin Foundation formed and then later set up the related APE-USD token.
The APE Foundation is the steward of ApeCoin, a legal entity that exists to administer the decisions of the ApeCoin DAO. A DAO is a decentralized autonomous organization. This is sort of the equivalent of a C corp or LLC in the decentralized world of cryptocurrency platforms.
What to Do With ApeCoin
There is no real use case for Apecoin, despite what its supporters say, in the real world. It is not a Defi (decentralized finance) token, not any kind of payment token. Its popularity relates to the waning popularity of the Bored Ape NFT series.
So, let’s be real here. If you decide to invest in the ApeCoin token, you are essentially following a “Greater Fool” investment theory. This is the underlying rationale supporting all speculative investing. You hope to sell your investment to a greater fool than yourself.
If that kind of rationale does not bother you, and you can convince yourself there is some real utility here, go ahead and invest. However, from a rational perspective expect to have to write off your investment. That, by the way, could make some sense, if you have some other crypto gains and you don’t want to pay capital gains taxes. Investing in Apecoin now might eventually allow you to make losses to write off against other gains.
On the date of publication, Mark R. Hake did not hold any position (either directly or indirectly) in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
