Dogecoin (DOGE), represented by the symbol Ð, is a digital asset like Bitcoin or Litecoin. It operates on the Dogecoin blockchain and was created by software engineers Billy Markus and Jackson Palmer. However, it started as a joke for crypto enthusiasts, its rise in value “to the moon” caught the attention of many, so Dogecoin managed to earn its place as a potential investment option in the crypto scene.
Dogecoin, often referred to simply as DOGE, came into existence when Billy Markus and Jackson Palmer decided to create it in 2013 to make fun of the crypto market. They wanted to design a peer-to-peer digital currency that everyone understands and has the potential to grow.
The iconic Shiba Inu dog from the “doge” meme became the face of this coin, with the currency’s logo and namesake drawing inspiration from this internet sensation. This playful project quickly gained popularity, especially in crypto community forums like Reddit as a matter of fact the official domain of Dogecoin reached 1 million users in just one month. Notably, it achieved a remarkable milestone on May 5, 2021, indicating the rising value of dogecoin, when its market capitalization reached over US$85 billion.
Key Moments in DOGE’s Journey – The Elon Musk Connection
This funny coin has experienced significant fluctuations and key moments in its history. Notably, in December 2013, it witnessed a remarkable 300% surge in value within 72 hours, following China’s restrictions on Bitcoin-related investments. However, it also faced challenges, such as a major price drop of 80% shortly after, partly due to the exploitation of mining pools.
Photo by Kanchanara on Unsplash
The cryptocurrency encountered setbacks, including a high-profile theft in December 2013 when millions of DOGEs were stolen in a hack on the Dogewallet platform. This incident led to a community-driven initiative called “SaveDogemas,” which aimed to assist those affected by the breach.
Its popularity surged in 2021, and its price was heavily influenced by events like a TikTok trend pushing for a $1 Dogecoin value. Tech guru Elon Musk also helped promote this meme coin through his Twitter/X posts. Later on he was accused of insider trading by investors.
At one point Musk tweeted that actually Dogecoin might be his favorite cryptocurrency and called it “pretty cool”.
@elonmusk You can’t decline! pic.twitter.com/5F0RAncfBo
— I am Hodler 🔑 (@iamhodler) April 2, 2019
In May 2021, SpaceX announced a historic move by accepting this crypto asset as a payment for a mission to send Dogecoin ‘to the moon’.
Dogecoin in the Real World
DOGE is actively traded on various reputable cryptocurrency exchanges like Binance and it is accepted by online communities for trading tangible items. Its adoption extends to the realms of property sales, the adult entertainment industry, and gambling. DOGE even gained visibility in the sports world, becoming the sleeve sponsor of Watford Football Club.
Maybe one of its main use cases is a tipping system, which allowing users to tip content creators on platforms like Reddit or Twitch. An interesting fact as well: in 2023, Ferrari accepts crypto payments to buy cars, including Dogecoin.
Fundraising and Community Initiatives
The Dogecoin community has actively engaged in charitable activities, like when they fundraised to send the Jamaican Bobsled Team to the Sochi Winter Olympics in 2014, or when NASCAR driver Josh Wise was sponsored by them.
In August 2021, the Dogecoin Foundation, with leaders who support dogecoin, re-established itself with a renewed focus on supporting its ecosystem and community. Notable advisors like Vitalik Buterin and Jared Birchall joined the Foundation.
Criticism and Controversy
DOGE’s origins as a joke have made it a subject of skepticism in mainstream media and aims it a profitable investment among financial experts. It’s essential to state that Dogecoin is a cryptocurrency with a strong following, despite its meme origins. However, while the history of how it was created is unique, DOGE received critics because of it’s connection to scams and raised concerns about its resemblance to a Ponzi scheme due to its unlimited supply. Moreover, the cryptocurrency price volatility have led some users to question its stability and long-term credibility.
The Memecoin’s Technology – How Does Dogecoin Work?
In this section we examine the technological capabilities and potential of Doge.
Dogecoin runs on its own dedicated blockchain, a digital ledger records all transactions made within the network. This ensures transparency and security for all users. All activities on the Dogecoin platform are authenticated and assimilated into its ledger via what’s termed the consensus mechanism. Notably, Dogecoin adopts a Proof of Work (PoW) consensus strategy, which is prevalent in its mining process, involving solvers tackling complex mathematical puzzles to bolster the network’s reliability and trustworthiness.
Connection with Major Cryptocurrencies Like Litecoin or Ethereum
While Dogecoin stands on its own blockchain network, its foundational technology shares similarities with giants like Bitcoin and Litecoin, especially given its initial connection to Litecoin’s Scrypt hashing algorithm. And however Dogecoin and Ethereum operate on separated blockchains, they have a bridge between them: so DOGE can be “wrapped” or converted into a token that is compatible with Ethereum’s network. This means it can interact with Ethereum’s smart contracts, enhancing its utility in decentralized finance (DeFi).
Integration with DeFi and dApps
The potential to earn DOGE in the decentralized finance ecosystem is further amplified by its ability to connect with decentralized applications (dApps). Once wrapped on the Ethereum network, this cryptocurrency can be used for payments in various DeFi platforms, applications, and services, proving its worth as an effective store of value.
It also allowing for lending, borrowing, and earning interest, among other financial activities. This integration, coupled with its relatively quick transaction time of just about a minute, positions it as a versatile player in the wider crypto scene.
Dogecoins Unique Supply Model
One of DOGE’s features is its supply structure, and the amount of dogecoin in circulation is always changing, unlike some cryptocurrencies with a capped maximum supply. It started with a supply limit of 100 billion coins. However, to ensure its longevity and continuous mining incentive, an additional 5 billion coins are added to the circulation annually, ensuring a steady yet decreasing inflation rate over time. This approach ensures both the reward for miners and the sustainability of the coin in the long run.
Differences Between Dogecoin and Bitcoin
Let’s start with market capitalization. At the time of writing, Bitcoin has a market cap of around $540 billion, whereas Elon Musk’s favorite coin has a significantly smaller market cap of approximately $8.5 billion. This indicates the scale and acceptance of each in the financial market.
Bitcoin is a more secure asset, because of the complex algorithm and greater mining capacity behind the network while Dogecoin is less secure. Bitcoin processes blocks roughly every 10 minutes, though this can fluctuate with network activity, in contrast to Dogecoin’s brisk one-minute block time.
Additionally, while Bitcoin is heralded as a digital storehouse of value, comparable to “digital gold”, the Dogecoin community places a significant emphasis on charitable initiatives, online gratuities, and other minor transactions. The perception and adoption of both coins in the wider market also vary, with Bitcoin being more widely recognized as a mature and established cryptocurrency, and DOGE often viewed through a more playful and community-driven lens.
Making Money With Dogecoin?
In this section we introduce how you can buy or sell Dogecoin on an exchange like Binance which supports the meme coin.
Dogecoin’s Investment Potential – Doge Price in 2023?
It’s hard to predict the future of the meme coin. Doge price has already experienced highs and lows, infulenced by social media platforms. Some argue that Dogecoin’s unlimited supply could limit its rise in value, while others believe its robust mining community will grow its value over time.
There are good points for it like X/Twitter has recently been granted a license for cryptocurrency services but Dogecoin is backed by a strong community ONLY (besides some social media posts from famous tech enterpreanurs), and there is very little real usecase at the moment behind it. Given Doge’s circulating volume and its unparalleled origin, it’s advisable to continue observing its trajectory.
However, a word of caution: like all cryptocurrencies, Dogecoin’s price is prone to fluctuations. Ensure you’re adequately educated about the market and transact through a trusted exchange.
At the time of writing, Doge’s price stands at $0.153. While 2023 has seen it dip from its initial price of $0.0702, it’s worth noting it reached a high of $0.096 during the year.
How to Buy Dogecoin? What’s the Best Dogecoin Wallet?
Buying Doge is an easy process, just follow the steps below:
- Choose a cryptocurrency exchange: Some of the well known echanges: Coinbase, Kraken, eToro or Binance where you have to register an account. Then prove your identity by a verification process. You will be guided by the exchange.
- Transfer money to the exchange: Bank transfer is a good choice as it has generally the lowest fees, however the exchange may accept other payment methods.
- Trade it: As your account is verified and the money is there you just select trade option and you can buy DOGE. It usually represented as DOGE/USD, DOGE/BTC, etc.
- Choose a wallet: Finally, storing your coins in a Dogecoin wallet is a safer way than holding them on the exchange. You can find digital wallets on Dogecoin.com. However it’s supported by most of the wallet so we recommend you to read our article about wallets.
We’ve already written an article about the best Bitcoin and crypto wallets, and after reading it, you’ll be able to choose the one that suits you best.
How to Sell Dogecoin?
Selling DOGE is as straightforward as buying it. Just follow these steps:
- Transfer Dogecoin to the exchange: If your coins are in a private wallet, you need to transfer them to your exchange account. Ensure that you enter the correct deposit address to avoid any loss.
- Navigate to the sell section: Once logged in and your coins are deposited, head over to the trading section. Look for pairs like DOGE/USD, DOGE/BTC, etc., depending on how you wish to receive your payment.
- Set your selling preferences: Decide if you want to sell at the current market price or set a limit order at a specific price.
- Finalize the sale: After setting your preferences, confirm and finalize the sale. Depending on the exchange and market conditions, your DOGE should be sold swiftly.
- Withdraw your funds: Once your DOGE is sold, the funds will be available in your exchange account. You can then choose to withdraw it to your bank account or other payment methods provided by the exchange.
