If you've spent much time reading about cryptocurrency, you've probably seen the phrase "to the moon." It's one of the unique expressions crypto enthusiasts use, and it's often accompanied by rocket ship emojis. Here's what it means and why you shouldn't let it guide your crypto investing decisions.
What does "to the moon" mean?
"To the moon" means that a cryptocurrency is either rapidly increasing in value or that people think it's poised to do so. If the price of Solana (SOL +5.98%) rises by 50% in a month, you could say that Solana is going to the moon. You could also say that phrase if you believe that Solana is going to skyrocket, even if it hasn't happened yet.
In the first example, "to the moon" is a description of what's already happening. In the second, it's a prediction (or wishful thinking) on the part of the investor.
Why "to the moon" caught on with cryptocurrency
The biggest appeal of investing in cryptocurrency is its growth potential. Quite a few cryptocurrencies have risen in value by more than 10,000%, and some by more than 1,000,000%, in just a few years. More than any other asset class, cryptocurrency really can go "to the moon" and deliver incredible returns to investors who buy at the right time.
However, cryptocurrency is a speculative investment and one where popularity plays a large role in a project's success. Many meme coins have exploded in value despite having no legitimate use.
Saying that a cryptocurrency is going to the moon is a way of hyping it up. It serves as a rallying cry for supporters of that crypto, and it can attract new buyers, which helps increase the price.
Don't get swept up in the hype
Take any comments that a crypto is going to the moon with a healthy dose of skepticism. People have said this about hundreds, if not thousands, of cryptocurrencies, and only a small portion of them became profitable investments.
It's a good sign when a cryptocurrency has built up a strong community of supporters, but that alone doesn't mean it's worth buying. Before investing, follow another popular piece of crypto slang: DYOR, which stands for "do your own research." Read about the cryptocurrency's uses, the services it offers, the problems it aims to solve, and the team behind it. This is a much better way of evaluating potential crypto investments than following social media hype.
Keep in mind that cryptocurrencies are high-risk investments. Even when you do your homework, there's no guarantee of success. A seemingly solid crypto project may go nowhere while a silly meme coin takes off. Because of the volatile nature of cryptocurrency, it shouldn't be a large portion of your investment portfolio. As a rule of thumb, invest no more than 5% to 10% of your money in crypto, and only put in as much as you'd be comfortable losing.
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When Shiba Inu went to the moon
Even by crypto standards, Shiba Inu (SHIB +2.08%) was an unbelievable success story for those lucky enough to invest early. It launched in August 2020 with an anonymous founder and nothing to make it unique. But from January through October 2021, its price increased by a staggering 74,000,000%.
Its value plummeted just as quickly as smart investors took their sizable profits. While Shiba Inu has had some periods of success since then and is still one of the largest cryptocurrencies by market cap, it hasn't come near its all-time high. Even when a crypto goes to the moon, it may not stay there for long, so decide your exit point ahead of time.
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