How risky is Mooncoin and why is the price going down?

THE price of Mooncoin has fallen recently after soaring to its highest ever level in May.

We explain the huge risks of investing in the cryptocurrency and why its value is down.

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Keen investors should know that making money through cryptocurrencies, like any investment, is never guaranteed.

Cryptocurrencies are highly volatile, so the value of your investments can go down as well as up in the blink of an eye.

In other words, don’t invest more than you can afford to lose in case prices crash, as it could mean your investment is wiped out.

Newer cryptocurrencies are also even riskier than more established ones, such as Bitcoin, and make you more open to scams.

What is Mooncoin?

Mooncoin is a cryptocurrency that was founded in December 2013.

It’s a so-called proof-of-work (PoW) coin, similar to Bitcoin and Litecoin, according to its website.

Proof-of-work is the algorithm that secures many cryptos.

Mooncoin claims to be establishing a platform for fast and secure monetary transactions, but there’s little detail on how it plans to achieve this.

What is the value going down?

The value of Mooncoin is currently sitting at $0.00000936, down by 16.7% over the past 24 hours, according to CoinGecko.

In comparison, it was worth a higher $0.00039226 on May 20.

It’s difficult to know exactly why investments fall in value, but it typically happens when and if a large number of investors sell off their assets.

Mooncoin’s previous rise in price also “appears to be driven by speculation with traders hoping for a short term profits rather than any belief in the long term benefits”, Susannah Streeter, senior investment and markets analyst at Hargreaves Lansdown, told The Sun.

Cryptocurrency markets were down as a whole earlier this month following a series of crackdowns by regulators around the world.

Last month, the Met Police also seized nearly £180million in the largest-ever cryptocurrency raid in the UK as part of a money laundering probe.

How risky is Mooncoin?

Investing in any cryptocurrency is essentially gambling, and you risk losing all the cash you put in.

However, investors should be extra careful about putting any cash into Mooncoin, according to Mrs Streeter.

She told The Sun: [Mooncoin] claims to have a roadmap laid out, but it’s clearly work in progress and given the competition in the blockchain payment space, it’s success is far from guaranteed.

“Traders should be extremely wary of any coin or token offering risk free return and look carefully at the long term use case of any coin or token.”

She added that other websites are also operating with Mooncoin in the title, attempting to lure in investors with promises of high earnings without risk.

This should be “a huge red warning light” to potential investors, especially given the volatility of the crypto markets.

Mrs Streeter said: “Traders should deal with such promises as potential scams, with other only people likely to make money being the scammers themselves.”

While Myron Jobson, personal finance campaigner of Interactive Investor, added to The Sun: “There is precious little information on Mooncoin for the average investors to truly size up the crypto.

“Mooncoin is in the early, nascent period of development and implementation, joining a number of new cryptocurrency offering a roadmap with lofty ambitions with little evidences to suggest that these goals can be achieved.

“For most investors, sticking to mainstream investments is the best strategy.”

The price of Bitcoin soared yesterday following claims that Amazon could start accepting the crypto as a payment method by the end of 2021.

We explain what you need to know about XRP and Polygon (MATIC).

Keen investors should also check out our guide on HEX.

This post first appeared on thesun.co.uk