Dogecoin is a meme currency that is becoming more and more known for the personalities that use it.
Dogecoin (DOGE) is a meme, but it doesn’t stop there; it is also a decentralized digital currency. These two characteristics are what make Dogecoin stand out in and out of the cryptocurrency market, as well as being the source of several controversies and many laughs on the Internet.
Key facts:
- Dogecoin was born in 2013 as a meme cryptocurrency that poked fun at worthless altcoins.
- Dogecoin’s popularity exploded when the world’s richest man started talking about it.
- The most popular use of Dogecoin is for donations, tips and recently by way of investment.
- Dogecoin can be managed on physical devices as well as computers and phones.
- Most exchanges accept the buying/selling of Dogecoin, such as Binance.
Dogecoin is an open source cryptocurrency, based on one of the most popular memes of all time and the Bitcoin (BTC) code. The Doge is the image of a Japanese breed dog, known as Shiba Inu, which is superimposed with grammatically incorrect sentences, which are written in multicolored “Comic Sans” font.
The meme dates back to 2013, the same year in which Jackson Palmer and Billy Markus, founders of Dogecoin, decided to create a digital asset for this funny dog. It all started as a way to make fun of the cryptocurrency industry, which by that time was beginning to be crowded with altcoins, alternative currencies to Bitcoin, and projects with great speculation. Thus, copying BTC’s public code, they created a new cryptocurrency.
1. The most beloved puppy on the Internet
Doge is one of the most legendary memes. It was born from a photo of a Japanese puppy, named Kabosu, taken by its owner in 2010. It is considered one of the most beloved memes on the entire web and survives to this day as a relic of the early days of the Internet.
However, what started as a joke gradually conglomerated a lively community that has participated in numerous charity events. In this way, Dogecoin has also gained a reputation as a means to send money online fast and without intermediaries (peer-to-peer). And finally, as an investment medium after it exploded in popularity on social networks and with the support of Tesla founder Elon Musk.
2. How was Dogecoin born?
To understand the spirit of Dogecoin it is essential to know its origin, which goes back to that cryptocurrency market that was just taking its first steps to expand beyond Bitcoin. Back then, at the end of 2013, the proliferation of altcoins was increasingly marked and the creation of poorly functional – and even fraudulent – cryptocurrencies was the order of the day.
Jackson Palmer, director of product management at Adobe, decided to voice his displeasure with this new industry reality via a satirical tweet. “Investing in Dogecoin. Surely it’s the new big thing,” the message on the social network read. Dogecoin didn’t exist back then, it was just a mockery that tried to represent the rampant practice of creating useless cryptocurrencies. Now the ecosystem had a meme dog coin, much WOW!
Palmer’s tweet was well received by the community, leading him to purchase the domain “Dogecoin.com” and create a landing page that had the same fun essence of the Doge meme. The page was presented to the public on December 6, 2013 and 30 days later it had managed to get more than 1 million views. The cryptographic meme was becoming a reality.
It was at this point, when the joke had already taken off, that Billy Markus entered the equation. The IBM software engineer had been thinking about creating a “fun” cryptocurrency that would be friendlier to adopt and use than Bitcoin itself. Upon seeing the Dogecoin proposal, he felt that the meme dog would be an eye-catching enough face to make a more serious proposal. Thus, Markus contacted Palmer to develop a technology behind the Dogecoin idea and turn the meme into a real cryptocurrency.
A guaranteed success?
Once DOGE was in circulation, success was not long in coming. Two weeks after its launch the price of the asset jumped 300% in a 72-hour period, although it then dropped sharply by 80% in value. Nevertheless, this was the first proof that Dogecoin would be much more than a seasonal joke.
3. The formation of a community
When talking about Dogecoin it is also important to mention the word “community”. Since while some cryptocurrencies are consolidated by their proposals, their operation or their trajectory, undoubtedly the success of DOGE lies mainly in the commitment of its community. Today the Dogecoin Reddit forum has 300,000 active members and counting, this being the center of many initiatives dedicated to charity and memes.
But this group of people was not formed out of thin air, but thanks to a reputation that Dogecoin users have built up over the years. One of the main reasons that put DOGE in the public eye was its charitable contributions in 2014, one of its most prolific periods.
For example, by that time, members of the community raised $30,000 so that the Jamaican bobsled team could participate in the Sochi Winter Olympics. The athletes had qualified for the competition, but did not have the financial support to afford to travel and stay in Russia. Thanks to the initiative of Dogecoin enthusiasts they were able to attend the competition that year.
DOGE users also promoted the “Doge4Water” initiative for that same 2014. The idea was to finance the drilling of water wells in Kenya, managing to raise another $30,000 for this activity. Last but not least, they sponsored NASCAR driver Josh Wise, giving him more than $50,000 in exchange for his car carrying the Dogecoin logo.
Tips for users
Over time, DOGE became popular as a tipping system on Reddit subforums, one of the first signs that the cryptocurrency could be more than a meme. Users would send small amounts of Dogecoin to content creators to reward them for their work. A practice that still continues today.
4. DOGE’s “wow” is no longer just laughter
Despite the success Dogecoin managed to garner in recent years, for some the dog joke has gotten out of hand. Jackson Palmer, the creator of Dogecoin himself, decided to withdraw from the team of developers in 2015 claiming that “the community was toxic.” In his view, both DOGE developers and its users have been seduced by the cryptocurrency’s rising price, ceasing to see it as a joke and starting to use it as an instrument of speculation.
Palmer has claimed on several occasions to be appalled with the success of his meme-cryptocurrency. He has also been critical of the few technological advances that have been made to the network in recent years, which he believes should be necessary for the asset to be revalued. Dogecoin has lagged behind in terms of technical updates compared to other cryptocurrencies on the market, such as Bitcoin or Litecoin. However, this has not stopped DOGE’s rise as an asset and there are future plans to improve the performance of Dogecoin’s blockchain, according to statements from its developers.
Billy Markus, the other head behind the project, also distanced himself and is inactive until further notice. However, his social networks remain focused on Dogecoin and the cryptocurrency community, educating other users about the benefits of these assets and participating in community discussions.
In the last two years, the Dogecoin market has reached unexpected dimensions, which have even surprised its creators themselves. Dogecoin’s success between 2020 and 2021 is largely due to the popularization of the cryptoasset on social networks such as TikTok, its promotion in investment groups on Reddit and the support of Elon Musk, founder of Tesla and one of the richest men in the world.
5. What is Elon Musk’s relationship with Dogecoin?
Elon Musk is not only synonymous with Tesla, SpaceX or “the richest man in the world”, but he also has a lot of kinship with Dogecoin. Musk has been flirting with the crypto dog community for a few years now, after he was proclaimed CEO of DOGE on April’s Fool Day.
In the best style of Dogecoin users, it all started with a joke made from the cryptocurrency’s official Twitter account. The account launched a poll to determine the new CEO of the project, arguing that they were looking for someone who would “take them into the future while maintaining the core values of who we are.” Elon Musk was on the shortlist, along with the likes of Vitalik Buterin, Charlie Lee and Marshall Hayner.
Elon Musk and Dogecoin memes roam social media after the tycoon boosted the price of the cryptocurrency and unleashed a buying spree among celebrities. Source: Screenshot of Elon Musk’s Twitter feed.
However, Musk won by a landslide. And this seems to have pleased the tycoon, because he played along with the community and even changed his twitter bio for a day to proclaim himself as “CEO of Dogecoin”.
Although the dynamic was short-lived, Elon Musk has not stopped tweeting about DOGE sporadically, has made several meme contributions about the asset from his official account and even accepted the purchase of Tesla merchandise with the cryptoasset. This has had repercussions on more than one occasion in a positive way for the price of dogecoin, with Musk’s support being one of the reasons why the cryptocurrency increased so much in value since 2020.
Currently, Elon Musk remains a big fan of DOGE and other dogecoin cryptocurrencies on the market, such as Shiba Inu. The tycoon has even claimed to have invested in such an ecosystem, a media coverage that has even earned him a lawsuit for allegedly trying to manipulate the market.
6. Who is behind the development of Dogecoin?
The most recognizable faces of Dogecoin remain Jackson Palmer and Billy Markus as founders of the cryptocurrency. Despite this, both creators no longer actively collaborate in the project and have bequeathed its development to other members of the community.
Although Jackson Palmer is the creator of Dogecoin, in recent years he has distanced himself from the project and the cryptocurrency ecosystem. Source: Linkedin.
In the case of Jackson Palmer, his distancing from Dogecoin is becoming more and more notorious, since a few years ago he had his own YouTube channel and Twitter account dedicated to educating about cryptocurrencies. However, Palmer recently decided to shut down the channel and has kept his twitter relatively inactive. Markus, on the other hand, does keep an eye on his social networks, which he uses to participate in ecosystem discussions and post educational articles.
The maintenance of the Dogecoin network has been left in the hands of Ross Nicoll, who is one of the lead developers on the project at this time. Nicoll is a software developer and has an academic background in computer science research. He has been working for the DOGE community for more than six years and is the head of the cryptocurrency’s developer group, known as Dogecoin Core.
Other important names in Dogecoin development are Michi Lumin and Maximilliam Keller. Lumin is a digital signal processor (DSP) engineer, as he describes in several of his biographies. He is also an active member of the Twitter cryptocurrency community. Keller, on the other hand, is involved in Android development, in addition to being part of the Dogecoin Core group.
7. How does Dogecoin work?
Like bitcoin or ether – to mention some of the most popular cryptocurrencies on the market – the technology that makes Dogecoin work is a blockchain network interconnected by multiple nodes. Each user can be his own node by installing open source software that allows him to interact with the network.
In this sense, Dogecoin works under the same parameters of other public and decentralized cryptocurrencies. It has a blockchain where all transactions made by users are recorded. Likewise, such transactions are confirmed thanks to a proof of work, an activity that is carried out by a group of miners who receive a reward in exchange.
Dogecoin, moreover, is based on the protocols of the Litecoin (LTC) and Luckycoin blockchains; being a fork of these. Because of this, it shares certain features with LTC, such as its “scrypt” mining algorithm. However, the developers also made essential changes, such as the fact that this is a coin with an inflationary issuance scheme. In other words, DOGE does not have a supply limit and new coins will continue to be issued as long as the network remains active.
8. How many DOGE are in circulation?
As we mentioned before, Dogecoin is a cryptocurrency that does not have a supply limit. As if that were not enough, it is also an inflationary asset, since – unlike bitcoin – DOGE has not reduced its issuance per block since 2014, mining an approximate 5.2 billion DOGE per year.
Dogecoin’s developers raised the possibility that a “scarce and valuable” cryptocurrency could also be an inefficient method of exchange. Because supply is limited, users who first entered such a network tend to hoard a larger number of assets, which are mostly “holdover” (or saved) to perceive higher profits, thus decreasing the liquidity of the currency and its exchangeability.
Given this hypothesis, they considered that the best scheme for Dogecoin was an unlimited supply, allowing the community to always have liquidity.
In this way, each block of this blockchain was programmed to contain about 10,000 DOGE, which is also the reward given by the network to miners for their activities. Thus, by the time you read this text there are already more than 130 billion DOGE in circulation, according to CoinMarketCap data.
There will always be DOGE
Dogecoin is an inflationary cryptocurrency. As long as there are miners on the network processing transactions, new coins will be issued to each mined block. In this sense, users will always have access to new tokens, because they will be infinite.
9. How can I mine DOGE?
Dogecoin is a blockchain that works by Proof of Work (PoW). A mechanism that is used in networks, such as Bitcoin, Monero or Litecoin, for the generation of new blocks and to avoid double spending attacks. Miners are in charge of carrying out this activity, which is vital for the decentralized operation of the network. In CryptoNews Cryptopedia we have content that delves into its complexity.
Like Litecoin, the blockchain where Dogecoin comes from, the hashing algorithm used in this network is called scrypt. It is an ASIC-resistant algorithm, which means that sophisticated mining equipment is not needed to be able to generate new coins and confirm transactions, as is the case in Bitcoin which requires a specialized mining machine.
Dogecoin miners can operate using a GPU card, as well as any computer with a Windows, Mac or Linux operating system. Also, another particular feature of Dogecoin mining is that it can be practiced in a merged manner. This means that miners can be trading Dogecoin and also Litecoin at the same time because it has the same mining algorithms, thus generating profits on both blockchains.
The reward miners receive per block mined is 10,000 DOGE. However, when operating it should be taken into account that DOGE prices are usually relatively low, so mining expenses could be very high to stay operational. These are elements that miners should take into account when connecting to a network, as the profitability of their activities will depend on them.
10. What is Dogecoin used for?
In addition to being a monetary meme, Dogecoin has managed to build a reputation in the cryptocurrency market. It is true that its use is not as widespread as other cryptocurrencies with greater reach, such is the case of Bitcoin, but this has not stopped DOGE from having its audience and being accepted as a payment method in particular circumstances.
In the case of donations Dogecoin has stood out as a reliable and fast to use asset. For example, there is an initiative called DogePizza that raises the donation of about 1,600 DOGE for the purchase of margherita pizzas for homeless shelters. A few years ago, a collection was also organized to buy socks for homeless people. These activities prove that DOGE can be used for charitable events.
Online tipping is another common use for the dog currency. DOGE is a cryptocurrency with fast transactions (a block is confirmed every minute, unlike bitcoin which averages 10 minutes). To top it off, the shipping fees are much lower than other digital assets on the market. Due to these characteristics, there are Internet users who accept DOGE as a reward for the content they share on the networks, a practice that became popular especially on Reddit.
Recently, DOGE gained popularity as a payment method when companies such as Tesla and the Dallas Maverick team decided to accept the cryptocurrency for payment of exclusive items. Payment processor Bitrefill also adopted the digital asset.
11. Which wallets can I use with DOGE?
Like other cryptocurrencies, there are a variety of options for storing your DOGE securely. It will depend on the user’s needs to decide whether he/she prefers an online wallet, a mobile app or a hardware wallet, as we have previously explained in Cryptopedia. Likewise, there is also the possibility of generating paper wallets to give Dogecoins as gifts to family or friends.
Here is a short list of the most popular wallets for Dogecoin:
- Exodus
- Bitpay
- Dogecoin Core
- MultiDoge
- Coinbase Wallet
- Ledger Nano
It is important to mention that when choosing a wallet it is vital for the owner to determine what level of security they want for their cryptocurrencies. Although downloadable applications on computers or phones are free and intuitive to use, they are also often more prone to theft at the hands of hackers.
12. Where can I buy and sell Dogecoin?
Dogecoin is available for purchase and sale on several major exchanges. In most of them it is necessary to have other cryptocurrencies, such as bitcoin or ether, in order to exchange them for DOGE. However, there is also the possibility of acquiring DOGE or other assets with Latin American national currencies or US dollars. Social networks and Telegram groups are also an option for person-to-person exchange, although they are not the safest platforms when it comes to buying digital assets.
Some of the most prominent exchanges for buying Dogecoin are:
- Binance
- Kraken
- Bittrex
- Huobi
Binance exchange has one of the busiest DOGE markets. Source: Binance.
As you can see, Dogecoin is a meme cryptocurrency with an enthusiastic community and a curious history. Due to these characteristics and the support of important figures, it has become an important member of the cryptocurrency market. If you want to know more about this ecosystem, we invite you to also read our content about bitcoin (BTC), tether (USDT) or ripple (XRP).
