He is a Dogecoin millionaire. And he doesn’t sell.

When Glauber Contessoto decided to invest his savings in Dogecoin last February, his friends had concerns.

“They all said you were crazy,” he said. “It’s a joke coin. It’s a meme. It’s going to crack. “

Your skepticism was justified. After all, Dogecoin is a joke – a digital currency founded in 2013 by two programmers who decided to fake the cryptocurrency craze by creating their own virtual money based on a meme about Doge, a talking Shiba Inu puppy. And investing money in obscure cryptocurrencies has historically been like throwing it on a campfire.

But Mr. Contessoto, 33, who works for a hip-hop media company in Los Angeles, is no ordinary buy-and-hold investor. He is among the many exciting amateurs who have jumped headlong into the markets in the past few months, using stock trading apps like Robinhood to make oversized profits on risky, speculative bets.

In February, after reading a Reddit thread about the potential of Dogecoin, Mr. Contessoto decided to go all-in. He dumped his credit cards, borrowed money through Robinhood’s margin trading feature, and spent everything he had on digital currency – about $ 250,000 total. Then, obsessively, he watched his cell phone as Dogecoin became an internet phenomenon, the value of which dwarfed that of blue-chip companies like Twitter and General Motors.

The value of his Dogecoin holdings today? About $ 2 million.

On the surface, Mr. Contessoto – who dropped out of college and has no formal financial education – seems no different than a lucky gamer who walks into a casino, wagers all of his chips on a single roulette spin, and walks out of the game a millionaire .

But it also represents a new breed of hyper-online investor who is winning by applying the skills of the digital attention economy – sharing memes, cultivating buzz, producing endless streams of content for social media – to financial markets .

These investors, mostly young men, are not behaving rationally in the old-fashioned Homo Oeconomicus sense. They don’t choose investments based on underlying fundamentals or Wall Street analyst estimates, but rather looser criteria such as how funny they are, how futuristic they look, or how many celebrities tweet about them. Their philosophy is that in today’s media-saturated world, attention is the most valuable commodity of all and that everything that attracts a lot has to be worth something.

“Memes are the language of millennials,” said Contessoto. “Now we have a meme that matches a currency.”

A sociable, bearded hip hop fan nicknamed Jaysn Prolifiq, Mr. Contessoto is a first generation immigrant whose parents came to the United States from Brazil when he was 6 years old. As a child in suburban Maryland, he saw his family struggling with money and he vowed to get rich. As a teenager, he discovered his love for hip-hop music and after school he moved to Los Angeles, where he took a job as an entry-level video editor and tried to book gigs for an emerging company. upcoming rapper he knew.

His dream was to save enough money to buy a house – one that he and his hip hop friends could live in and make music at the same time.

But that kind of cash was elusive, and he spent several years crashing into couches trying to save enough for a down payment.

In 2019, he started buying stocks in Robinhood, the commission-free trading app. He stuck to big, well-known companies like Tesla and Uber, and as those deals made money, he bought more. And in January 2021, he watched with fascination as a group of traders on Reddit successfully drove up GameStop’s share price, squeezing hedge funds that had bet against the video game trader, making millions for themselves in the process. (He tried to get into GameStop trading, but was late and lost most of his stake.)

Shortly after the GameStop saga, Mr. Contessoto was browsing Reddit when he saw a post about Dogecoin. He had heard of the currency. (Elon Musk, who is roughly what Pope Francis is to Catholics to Dogecoin fans, had called it the “people’s crypto”.) But as he did more research, he became convinced that Dogecoin ‘s witty, accessible image took it to the next GameStop could do.

“Dogecoin has the best branding of any cryptocurrency,” he said. “If you put all the symbols of Ethereum, Bitcoin, Litecoin in front of me – everything just looks super high-tech and futuristic. And Dogecoin just looks like this: Hey guys, what’s going on? “

He envisions that newbies to investing in cryptocurrency for the first time will be drawn to something fun and recognizable, and that Dogecoin could eventually become a kind of driveway into the larger world of virtual money.

“I have a feeling that at some point we will all buy and sell things with memes, and Dogecoin will lead the way,” he said.

As strange as his investment thesis may seem, it’s hard to argue with the results. Even after a recent crash following Mr. Musk’s appearance on Saturday Night Live (in which he joked that Dogecoin was a “crush”), Dogecoin remains a very lucrative trade. A dollar invested in Dogecoin on Jan. 1 would be worth $ 203 today – much more than a comparable investment in Bitcoin, Ethereum, or any stock in the S&P 500.

The stratospheric rise of Dogecoin has also sparked a lot of grumbling among cryptocurrency fans, who see it as a tasteless sideshow that overshadows more serious uses of cryptocurrency. One of the original creators of Dogecoin has disavowed the coin, and even Mr Musk has warned investors not to speculate in cryptocurrencies. (Mr Musk recently roused the crypto markets again after announcing that Tesla would no longer accept Bitcoin.)

What then explains the shelf life of Dogecoin?

There’s no doubt that the Dogecoin mania, like the GameStop mania before it, is at least partly due to a combination of pandemic-era boredom and the eternal appeal of plans to get rich quick.

But there can be more structural forces at work. In recent years, rising housing costs, record student loan debt, and historically low interest rates have made it harder for some young people to imagine achieving financial stability by slowly working their way up the corporate ladder and saving money on paychecks their parents did .

Instead of ladders, these people are looking for trampolines – risky, volatile investments that can either result in a life-changing windfall or get them right back where they started.

Mr. Contessoto is a great case study. His job now makes him $ 60,000 a year – a decent living, but nowhere near enough to be able to afford a home in Los Angeles, where the average home is close to a million dollars. He drives a battered Toyota and lived frugally for years. But in his thirties, still without a home, he decided to look for something that could change his fate overnight and ended up at Dogecoin’s door.

When Mr. Contessoto remembers how he used to pursue wealth – worked hard, cut expenses, saved money from every paycheck – he sees evidence of a system being manipulated against ordinary people.

“I feel like these experts on television, the older generation of old money and wealth, are trying to scare people into keeping them safe, so that no one gets too rich,” he told me.

His new motto, he said, was “Money doesn’t make you fearful”.

There is much about Mr. Contessoto’s investment philosophy that would turn the stomach for a traditional financial advisor. But the wildest part is that despite his spectacular winnings, he has not yet paid off his Dogecoin millions. He assumes that the rate of the currency will continue to rise and does not want to miss future profits by selling too early. (He plans to sell 10 percent of his stake next year once his earnings are classified as long-term capital gains and taxed at a lower rate.)

Instead, he brands himself as a Dogecoin expert, adopts nicknames like “The Dogefather” and “Slumdoge Millionaire”, and makes YouTube videos promoting Dogecoin to others.

“I’m optimistic about how the Dogecoin community is doing,” he said. “If that has exceeded my expectations of Dogecoin and I haven’t achieved it for two months, imagine where it will be in a year.”

Of course, as with any volatile investment, there is a real chance that Mr. Contessoto’s Dogecoin holdings could lose most or all of their value and that his dream of owning a home could be out of reach again. Dogecoin price has already fallen nearly 50 percent from its all-time high, saving hundreds of thousands of dollars from Mr. Contessoto’s portfolio.

But players rarely leave the table the first time they lose, and Mr. Contessoto’s commitment to “HODLing” – an acronym for “hold for life” preferred by cryptocurrency traders – has helped him through the recent market turmoil. Earlier this week, he posted a screenshot of his cryptocurrency trading app showing that he had bought more. And on Thursday, when the value of his Dogecoin holdings fell to $ 1.5 million, about half of the high, he posted another screenshot of his account on Reddit.

“If I can HODL, you can HODL!” read the caption.

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