A top crypto influencer has claimed that Dogecoin is his 'retirement plan'. And not just any retirement plan, but the 'greatest of all time'.

YouTuber Matt Wallace posted the affirmation to his 638k followers on Twitter. Not everyone was so convinced. "Doge is not going to hit $1" wrote one commentator. "This is a terrible idea" wrote another. 

But others posted graphs showing the price of Dogecoin was up 265% over the past five years. Another 70-year-old investor said he had 'DIAMOND HANDS' and that if Dogecoin success didn't come for him he'd leave it for his son.

So just how good is Dogecoin as a retirement plan? Let's look at three reasons why this might not be a great idea.

Dogecoin is a risky asset 

Traditional wisdom on investing for retirement is certain about one thing: investing for retirement needs to be low risk.

Dogecoin is up 265% over the past five years. But it's also down 92% since the all-time high in May last year. That kind of volatility is not conducive to a retirement plan where you need to be taking out monthly sums.

There's also a chance that the Dogecoin price never recovers to the price you bought at. 

Dogecoin is inflationary

The Dogecoin supply increases every year by 5 billion DOGE. With a circulating supply of 132.67 billion that's an inflationary rate of around 4% annually.

It means that if Dogecoin trading remains the same, the value of your Dogecoin holding will fall year after year. The block reward is 10,000 DOGE for miners and this is part of the core code which can't be changed. 

It's a huge contrast to tokens like Bitcoin – with a capped supply – or a token like EverGrow which is deflationary.

The EverGrow supply is actually reducing by 5% each year thanks to a transaction tax which collects 2% from each buy or sell to burn EGC tokens from supply. The burn rate has been ramped up significantly in September and October following the launch of an EverGrow NFT marketplace (LunaSky) which sends 100% of revenue for buying back and burning EverGrow.

The revenue collected from EverGrow NFT sales also created a fund that could artificially raise EverGrow prices every day for 60 days when burning starts. 

There is volatility in every crypto asset. However, looking at the tokenomics of Dogecoin doesn't give assurance for DOGE as a retirement plan. 

Dogecoin doesn't have a use case yet

This is the greatest question.

What will Dogecoin be useful for? The success of Dogecoin in 2021 was based off a large community and hype surrounding Elon Musk. But what if Elon Musk sold all his Dogecoin? What if other tokens proved more lucrative than DOGE?

Musk has allowed the use of DOGE to purchase Tesla merch and pay for rides on the tunnel taxi system in Las Vegas. But for Dogecoin to really become a strong asset that appreciates in value over time, it's needs to be useful.

Until then, Dogecoin trading is pure speculation. And speculation is not something to base your retirement on.