In February, Glauber Contessoto, 33, invested all his savings in dogecoin, a meme-inspired digital currency that increased in value this year. And about two months later, in April, he says he became a paper dogecoin millionaire.
Now, Contessoto plans “everything” in another cryptocurrency, he told CNBC Make It. Its next option is the Cardano blockchain and its altcoin ADA, which was launched in 2017 and recently became the third largest cryptocurrency by market value, behind bitcoin and ether.
While he has no plans to sell his dogecoin, “I will start buying as much Cardano as possible with all the money I start earning from now on,” he says.
Contessoto plans to wait until there is a drop in the price of the ADA to start investing, he says, just as he did with dogecoin.
However, many financial experts would advise against making any investment, especially within the cryptographic space. Cryptocurrency can be a very risky investment in general and experts say high currencies can still be.
“Risk can be measured in several different ways,” Meltem Demirors, CEO of strategy at CoinShares, told CNBC Make It. But “many of these assets are much riskier than bitcoin and ethereum.”
It is possible to lose the entire investment regardless of the precaution you take.
Despite this, Contessoto remains bullish on both dogecoin and Cardano.
Because Contessoto did not buy ether, the original cryptocurrency from the Ethereum blockchain initially believes Cardano is the “next best bet,” he says. Cardano supporters, such as Contessoto, consider him an Ethereum competitor as its creator, Charles Hoskinson, is also a co-founder of Ethereum.
Cardano against Ethereum
However, Cardano’s critics say he has a long way to go before he reaches Ethereum.
Ethereum is known for its smart contract capabilities, which fuel DeFi or decentralized financing, applications and NFTs or non-expendable tokens, among other things.
Currently, Ethereum works with a working test model, or PoW, where miners have to compete to solve complex puzzles to validate transactions. But soon, Ethereum plans to migrate to a participation test, or PoS, model, where people can extract or validate transactions based on how many coins they have. PoS supporters say it consumes less energy.
This migration is part of a long-awaited update to Ethereum that, according to its developers, will improve the blockchain and overall efficiency.
However, Cardano already works with a PoS model. That’s why the Cardano community sees the blockchain as a more environmentally friendly alternative to Ethereum.
But unlike Ethereum, Cardano continues to work on its smart contract capabilities, which it plans to launch as part of an upgrade later this year.
That’s why, in part, billionaire investor Mark Cuban, for example, thinks that so far Cardano use cases fall short. “Personally, you can use [Cardano] for nothing? If so, what did you use it for? This is the question I ask about all cryptography [before investing]”Cuban he tweeted in May. “Do you find yourself using it for something you find valuable?”
If you plan to invest, keep in mind that financial experts recommend being very cautious when investing in cryptocurrencies in general because of their volatile and speculative nature.
Some experts warn of being especially cautious when investing in altcoins, as many of them do not have, for example, the scarcity and technological development that Bitcoin has. Investors could burn out and, in turn, only have to invest what they could afford to lose.
While Contessoto acknowledges that “it’s still early” for Cardano, “I’ll be Cardano’s biggest follower,” he says. “I’m waiting for a massive dive before I buy into it.”
According to CoinMarketCap, as of 10:50 a.m. EST on Thursday, Cardano’s ADA is trading at about $ 2.60, and dogecoin is trading at about 27 cents.
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