Dogecoin is the most popular and successful meme cryptocurrency out there. In fact, it is so popular we can’t help but constantly ask ourselves if Dogecoin is a good investment.
The answers vary. The coin is most of the time dismissed because it started as a joke.
But how could a joke keep going since 2013 and constantly reemerge? Well, that’s what we want to explore in this article.
This article does not represent financial advice, and you should always do your own research before taking any decision.
What is Dogecoin?
The official website tells us that Dogecoin is an open-source, peer-to-peer digital currency favored by Shiba Inus worldwide. Most importantly, a Dogecoin’s value is a Dogecoin.
Back in 2013, Jackson Palmer purchased a website and photoshopped the Shiba Inu Doge meme over a coin, and made the dogecoin.com website. His goal was to create a fictional currency meant to mock the market’s greed and the clone coins that kept popping out.
Palmer had never intended to do anything more than a joke; however, American software developer Billy Marcus contacted him to propose turning the joke into a reality.
So, Dogecoin came into existence, having its bases on a fork of Litecoin called Luckycoin.
If it’s a fork of Litecoin, then Dogecoin is a proof of work coin.
Exactly! Believe it or not, Dogecoin has its own functioning proof of work blockchain with Dogecoin miners, transaction confirmation, and all.
The network supports 30 transactions per second and confirms a transaction in 5-10 minutes at the cost of only one cent.
In order to improve security and miner profitability, in 2014, the meme cryptocurrency adopted merged-mining. Thus, Litecoin miners could become Dogecoin miners without increasing their costs or using additional resources.
In 2018, the Initial supply of 100 billion had been reached, and from that point, each mined block produces 10,000 new Doge, increasing the total supply by 5 billion coins per year.
That may seem like a lot. But considering the tokenomics, the inflation is not that high.
Dogecoin has tokenomics?!
Yes, Dogecoin has tokenomics. If you wondered how many Dogecoins are there, there is over 132.6 billion Doge, and the number is growing, with 100% of the total supply in circulation.
The 5 billion Doge minted yearly corresponds to an inflation of 3.87%, which is actually low compared to other inflationary cryptocurrencies. And as the years go by, that percentage will actually get even lower as the new 5 billion Doge will represent a smaller ratio of the total supply.
As a launching method, Dogecoin has gone through a fair launch without any pre-sales or private sales, with every single coin being available to the public.
What is Dogecoin used for?
Over time, Dogecoin has been primarily used for tipping Reddit and Twitter users. But weirdly, this meme coin is listed on most crypto exchanges.
It is also accepted by various vendors. You can use Doge to buy food, drinks, hosting, and other stuff from the internet.
Recently, the electronics retailer Newegg has implemented Dogecoin as a payment method in more than 70 countries.
And of course, besides being a tipping mechanism and a cheap means of exchange, Doge is also a “little extra” Litecoin miners get for securing the Dogecoin blockchain.
Dogecoin in time
Dogecoin started as a mockery in 2013 at Jackson Palmer’s initiative and turned into a real cryptocurrency with the help of Billy Marcus.
In 2014, Litecoin founder Charlee Lee approached the Dogecoin team to propose merged mining to secure the network.
The cryptocurrency was designed to keep a low value and be approachable to newcomers, but that didn’t stop the team from organizing community funding and sponsoring various events.
The foundation and the community sponsored the Jamaican bobsled team and Shiva Keshavan in the 2014 Sochi Winter Olympics.
Another famous sponsorship is the fundraising for NASCAR Sprint Cup Series driver Josh Wise. The community raised $55,000, and the car was nicknamed the “Moonrocket,” featuring a Dogecoin/Reddit-sponsored paint scheme.
In more recent news, it seems like Dogecoin is about to fundraise for NASCAR again as on March 2, 2021, NASCAR Xfinity Series team B. J. McLeod Motorsports announced that the crypto would be sponsoring the #99 car in the Alsco Uniforms 300 at Las Vegas.
But going back to memes, Dogecoin has always received strong support and engagement on Social Media. It was always popular on Reddit and Twitter, especially.
Around these platforms, the Doge community has popularized objectives such as “Dogecoin to the moon” and “Dogecoin to $1”.
Elon Musk often tweets about Dogecoin and trolls his followers, driving up pumps. And nowadays, increasingly, more TikTok influencers encourage their audience to get into the Dogecoin hype train.
Since 2021, the value of Dogecoin has fallen rapidly, bottoming out around $0.11 in March 2022, even though with all these changes, Dogecoin remains among the top 20 cryptocurrencies.
On the other hand, Dogecoin will undergo certain adjustments as a result of technological advancement. How? The Dogecoin Foundation presented a trailmap at the end of December, indicating that 2022 will bring some modifications to the Dogecoin.
Sidenote – The Dogecoin Trailmap is less strict than a roadmap that aims to maintain Dogecoin’s community-driven, consensus-based approach.
The choice for the trailmap will not affect the way Dogecoin was built; what is essential is that Dogecoin remains a decentralized project with shepherds rather than rulers, each of whose initiatives and contributions succeed or fall on their own merits. The Trailmap is intended to reflect the contribution to the success of Dogecoin.
Following the Manifesto project, which was intended to capture what the community desired from the Dogecoin plan, the project team has thought more deeply about this notion and has set the fundamentals of the Foundation Trailmap, with an emphasis on simplicity, usefulness, and dependability.
A new Dogecoin approach that delivers security through network diversification as well as a proven Dogecoin Standard with extensive testing. With the integration of scalable backend solutions such as the GigaWallet Project, there will be new payment methods for providers, merchants, game developers, and social platforms.
The proposed Dogecoin Keyring App & SDK will address community safety by allowing users to keep custody of their Dogecoin while integrating the GigaWallet APIs so that mobile apps may trade Doge without holding a key.
This project also intends to engage with Vitalik to develop a unique Doge concept for a Community staking version of PoS that would allow everyone, not just the big players, to participate in a way that recompenses them for their contributions to the network’s operation.
What are the changes that Dogecoin goes through?
Dogecoin.com makeover & Dogepedia
The trailmap will put its mark on Dogecoin by implementing major modifications, beginning with a makeover of the Dogecoin website. The new website will provide everyone with all the information they need, from links to current projects and teams to information about the network and how to become involved as a developer, miner, HODLr, or fan. This will feature a comprehensive list of frequently asked Dogecoin questions called “Dogepedia.”
Libdogecoin will comprise the implementation of Dogecoin Protocols as a C Library, allowing anyone to construct a Dogecoin compliant product without requiring much knowledge. It is essential to understand that Libdogecoin will be a pure library with no runnable node functionality. The team’s goal with this promising approach is to make the Dogecoin Ecosystem healthier by diversifying the reliance on the Core Wallet as the single concept of the Dogecoin Blockchain.
Increasing the number of alternatives for standard-based wallet and node implementations to be developed, as well as the level of integration to boost platform acceptance of Dogecoin. Improving the joining procedure for the Dogecoin network so that more users may run Dogecoin nodes.
Dogecoin Standard will be more of a written specification and validating test suite generated by the Dogecoin Core Wallet during the creation of Libdogecoin. This implementation aims to fill the void left by the often requested whitepaper and give documentation to anyone attempting to understand how Dogecoin works.
This functionality will also make it easier for new developers to work with Doge, and there will be a new library of building blocks to assist people who wish to create Dogecoin goods.
The GigaWallet is a new Dogecoin utility, an open-source initiative meant to deliver a noded/API solution that can allow developers to add the Dogecoin transactions to their platform in seconds as easily as they would with any established payment provider.
This feature intends to provide two levels of API, the first for processing and verifying conventional Dogecoin using a contemporary event architecture ready to interface with message queues and web APIs. The second is to integrate with the planned process Dogecoin Keyring App & SDK.
But that’s not all that Dogecoin has planned for this year; there will also be some new initiatives. Dogecoin Keyring (APP/SDK), RadioDoge (Starlink + Radio nodes for remote regions), Community Staking (Proof of Stake), and Point of Sale (L2 app) are all projects that will soon be implemented into the Dogecoin community.
Is Dogecoin a Good Investment?!
A part of the crypto community has been talking about Dogecoin going up since it started. Also, various topics have encouraged Reddit users to invest in Dogecoin for around $25 to get $10,000 when it gets to $1.
Leaving the hype aside, we can see that Dogecoin is able to go up. But there is a catch.
Doge’s success and its resilience over time comes from a combination of social media popularity, meme culture, influencers, and speculation.
The truth is, speculators are winning the most from Dogecoin’s pumps and dumps. And a relatively steady price for this coin is quite improbable, especially considering that more than 50% of the coins are kept in 3 wallets whose identity is unknown.
And if you think of investing in Dogecoin before it gets to $1, you should keep in mind that DOGE has a price of $0.06 at a market cap of $8.4 billion. And considering the inflation, Dogecoin needs a market cap of at least $133 billion to reach $1.
That’s quite a lot to accomplish. However, the cryptocurrency market is a strange place, and Dogecoin is already an absurd cryptocurrency that has existed for almost a decade.
We can’t dismiss the possibility of seeing Dogecoin reach $1 through the power of memes and social media. However, speculators are most likely to crush the price afterward.
- Dogecoin is an open-source, peer-to-peer digital currency favored by Shiba Inus worldwide. Most importantly, a Dogecoin’s value is a Dogecoin.
- Dogecoin is a proof of work cryptocurrency based on Luckycoin, a Litecoin fork. Because of that, Litecoin miners can merge-mine Dogecoin alongside Litecoin.
- Dogecoin has a total supply of 132.6 billion Doge with inflation of almost 4%. It is used for tipping Reddit and Twitter users, buying products and services from various online vendors, and for incentivizing Dogecoin miners.
- In time, Dogecoin has seen several pumps and dumps, but it seems to always come back.
- As an investment, Doge seems to be surrounded by speculation. However, we can’t dismiss the possibility of seeing Dogecoin reach $1 through the power of memes and social media.
- The new implementation of the trailmap will mark the Dogecoin evolution and its impact on its community.