If you’re looking for new investment, or you just want to know what Elon Musk is talking about, you want to learn about Dogecoin. On the surface, it’s a joke that has made some people rich, but is that all there is to Dogecoin?
From the laughing stock of crypto Twitter to Elon Musk’s pinned Tweets, Dogecoin is as relevant today as anything else with a total value of $40B. That’s right, at the time of this writing, Dogecoin is worth more than eBay. Let’s get down to the nitty-gritty and learn a little more about Dogecoin. In the meantime, head on over to our trading page for more information.
What is DOGE?
We’ve all had a joke go too far. Back in 2013, fake crypto coins were coming out seemingly every day. To comment on these fake crypto coins, Billy Markus and Jackson Palmer created Dogecoin (DOGE). Aside from being a joke named after the Shiba Inu dog memes from that era, Doge became a faster alternative to Bitcoin.
Dogecoin is a form of digital currency that allows peer-to-peer transactions using a decentralized network.
Similar to Bitcoin and Ethereum, Dogecoin is a cryptocurrency that runs on a blockchain. The Doge ledger is then updated with all the new transactions of Dogecoin, when people buy and sell it (or if they transfer it to another wallet offline).
Using cryptography, Dogecoin’s blockchain network ensures security of all transactions. Similar to Ethtereum and Bitcoin, for a transaction to occur, miners need to verify all transactions. Miners solve complex mathematical equations to process transactions and record them on the blockchain.
So why is Dogecoin showing up on the forefront of the news? Even the people who don’t buy, sell and mine cryptocurrency all seem to know about it. What’s all the fuss?
How did Dogecoin become famous?
The meme had a lot to do with the immediate fame of Dogecoin, but it’s also known for some strange publicity that you don’t see from other crypto coins.
First, back in 2014, a Reddit user lead the charge in crowd sourcing $50,000 to sponsor the number 98 Ford Fusion driven by Nascar racer, Josh Wise. Along with that, Dogecoin is known for sending money to the Jamaican Bobsleigh team to help get them to the 2014 Olympics.
Recently, we’ve seen a resurgence in the Dogecoin. An initial jump came from a group of Reddit users that go by the name SatoshiStreetBets. The same group is also responsible for the ridiculous and unsustainable jump in GameStop stock.
Along with these other stunts, Elon Musk has jumped onto the Dogecoin wagon. Tweeting his fondness for Dogecoin multiple times, he has coined himself the Dogefather, while also supporting the sustainability of the crypto coin.
For a trailer in his SNL appearance, Elon Musk tweeted a picture of him as the DOGE father. “The Dogefather SNL May 8,” the Tesla CEO tweeted, referring to his hosting gig on “Saturday Night Live.”
The tweet appears to have sparked enthusiasm among Dogecoin traders, who were hoping for further exposure for the meme-based cryptocurrency in front of a broad television audience.
Whether he’s right or wrong is yet to be seen but it has of course stirred up interest. More important than all of these – is Dogecoin sustainable?
If you have Dogecoin, should you sell or hold?
What are the Risks Involved in Investing in Doge?
At the time of writing. Dogecoin is in top five cryptocurrencies in terms of market capitalisation. It trails Bitcoin, Ethereum and Binance Coin in terms of market capitalisation. On the internet, dogecoin supporters are hoping for a $1 price.
Cryptocurrencies are highly unpredictable, with significant fluctuations in price in either direction. Bitcoin, for example, has soared this year, trading above $61,000 on April 16 compared to less than $30,000 at the end of last year. However, the cryptocurrency has been subject to pullbacks in the past, including this year.
Tesla announced earlier this year that it had invested $1.5 billion in bitcoin and will begin accepting bitcoin as payment for its goods. Garrick Hileman, head of analysis at blockchain.com, a cryptocurrency transactions firm, warns that Dogecoin could easily lose 90% of its value. “I am concerned about the amount of attention being given to a cryptocurrency that has never had real-world traction and is a bit of a joke—literally,” he said.
Should I be buying or selling Dogecoin?
One of the aspects of Bitcoin that makes it a very lucrative investment is its scarcity, meaning there is a limited number of available coins. One of the most basic economic concepts is that of supply and demand. If there are more people who want to buy a product than there are available, the price of that product will most likely go up.
One of the problems with Dogecoin is that the number of coins is growing constantly. For now, the supply and demand seem to be fairly steady, but who’s to say when that will come to an end?
Another thing that can make Dogecoin a less than stable investment is that isn’t backed by much of anything. Dogecoin started as a satire and it remains a satire in 2021. It’s one of the most memed about phenomena on the internet.
Buying any cryptocurrency can be risky and volatile, but Dogecoin may be a little more so than most. Those who bought Dogecoin at the beginning of 2021 are still seeing some substantial returns, but who knows when that trend will come to a close.
Dogecoin is a cryptocurrency that uses a decentralised network to facilitate peer-to-peer transactions. It is well-known for funding the Jamaican Bobsleigh team’s trip to the 2014 Olympics and for other guerilla ad campaigns that have boosted its presence.
The number of Dogecoin is continuously increasing, making it a risky investment. Please do your own research. Supporters of the dogecoin price are aiming for a $1 price, which would make it one of the top five Cryptocurrencies in the world. However, despite many people predicting Doge’s success, there are also many skilled traders that are patient enough to know when to strike. Know your investment thesis and stick to it.