With more than 47 million Twitter followers, Elon Musk holds a great deal of influence in the world of tech and cryptocurrency, proven by Dogecoin’s meteoric growth in recent weeks. A single tweet from Musk sparked overnight interest in the currency, first released in 2013, and now has investors taking it seriously. The payment system, developed by Billy Markus and Jackson Palmer, reached a market capitalization of $5,382,875,000 in January, and with its value growing rapidly, it’s a genuine Bitcoin alternative. Now could be the time to invest…
The Changing Consumer Landscape
In early February, SpaceX founder Elon Musk sent out one tweet to his millions of followers, asking “Who let the Doge Out?” not only demonstrating Musk’s power but the incredible appetite for alternative currencies in today’s uncertain political and economic times. Alongside Redditors coming together to fuel a takeover of Wall Street, investing in stocks like GameStop, 2021 has already proven to be one of the biggest years yet for the reconsolidation of finances, with consumers ready to part with their cash and invest in the “Next Big Thing”. Sure, you could say that currencies such as Bitcoin are something of a fad, and their growth bubble could one day burst, it’s time to start taking crypto seriously. One that’s worth watching is Dogecoin (DOGE), a Bitcoin rival with the backing of stars like Snoop Dogg, ideal for early investors.
The currency was the brainchild of Billy Markus and Jackson Palmer, and though it started as a joke between engineers back in 2013, the currency has since moved from the fringes into a mainstream product, worth more than the likes of JetBlue, Harley Davidson, or Under Armour in aggregate. And thanks to its cult following on social media sites like Twitter and Reddit, with meme-worthy content encouraging people to invest, the currency could prove to be a new financial tool - with incredible rewards for those considering an investment. First, a disclaimer: the rapid growth of the currency does indeed mean that its price will continue to climb in the coming weeks, but you shouldn’t bet your entire life savings on the coin just yet. It’s important to exercise caution when investing and speak with a professional advisor.
Dogecoin is a digital currency that was named after the internet meme that centered around a dog with poor spelling habits (hence the word doge, not dog). The meme features Shiba Inus (nicknamed “Shibe”) and rose to prominence on Tumblr with interior monologues in Comic Sans font. The cryptocurrency - a digital form of a currency based on blockchain tech - is digital, encrypted, and decentralized, and you can use it to buy goods and services as you would with any other currency (though you’ll first need to find retailers that accept the currency). In recent years, consumers and professional investors have sunk billions of dollars into cryptocurrencies such as Bitcoin, in the same way that they do stocks and metals, thanks to globalization and the changing financial landscape amidst recessions and the COVID-19 pandemic. Bitcoin is the poster child of the cryptocurrency sector, and though it has risen to prominence, it’s also received significant backlash from world leaders, banks, and financial institutions who say its lack of transparency and traceability make it the choice for criminals. However, in 2020, at a time when many of us reevaluated our life choices, the volatile cryptocurrency reached new heights with many viewing it as a “safe haven”. And as towards crypto shift, new players like Etherum, Litecoin, and now Dogecoin, are growing.
The Coin Of The Internet
Dogecoin has been praised by a number of high-profile celebrities and financial players in recent months, and it’s now the tenth largest cryptocurrency in the world, despite thousands of options being available to choose from. Elon Musk for example called it "people currency" whilst Snoop Dogg took to Twitter to share his excitement. American singer-songwriter Gene Simmons has also promoted Dogecoin to his followers, tweeting slang phrases in crypto like “HODL” and “to the moon.” He also revealed that he has made over 6 figure investment with dogecoin . Millionaires, billionaires, and YouTubers have also joined the hype train and pledged their allegiance to the currency in recent months, further fueling Doge's growth. Since the start of 2021, Dogecoin has experienced a 1,600% jump and the open-source, peer-to-peer currency is now a preferred choice.
Billy Markus and Jackson Palmer, previous alumni of IBM and Adobe respectively, wanted to combine their love of the internet meme and cryptocurrency and formed Dogecoin, with no real expectations of its success or longevity. Designed on the Litecoin codebase, Dogecoin offers users an attractive alternative to Bitcoin, and its initial success could, in part, be down to its accessibility compared with rival currencies. What’s particularly interesting about the currency is that, in the DOGE blockchain, blocks are created much faster than in Litecoin, with one coin every 150 seconds. What’s more, Dogecoin doesn’t limit the number of coins that can be added to the system, and so its use and value can endlessly grow, though this does have some drawbacks. The currency has, without doubt, been helped by Redditors, with a subculture around the cryptocurrency growing in popularity. From its inception back in 2013, where the currency received one million page views on the day of its launch, to becoming the second-most-tipped currency on the internet (where consumers repay people for performing good deeds, encouraging more consumers to buy into the DOGE ecosystem). What’s even more interesting about Dogecoin is that it had a relatively low barrier to entry - you don’t need to be an expert to get into the coin or spend thousands of dollars in doing so.
Just like its rivals, Dogecoin’s main purpose is to offer peer-to-peer transactions in a censorship-resistant manner, and thanks to its purpose of spreading goodwill and fun through the cryptocurrency community, it’s built a name for itself in doing so. Indeed, though it was never the intention of its developers for the currency to become mainstream or take on Bitcoin, the truth is that the incredible interest in the product in recent months has made that a reality. Add in the fact that the currency can be used in the same way as Bitcoin, sending money to anyone internationally, and that more vendors are now accepting the currency, and it’s clear why it’s grown in value. On top of this, the Dogecoin network is secure and offers real-time consensus - for added peace of mind, hackers would need to be able to control at least 51% of the network’s hashing power to alter the state of the blockchain, and because the currency has a hash rate of 203.97 TH/s, the chances of that are incredibly unlikely.
The currency works in the same way as Bitcoin, give or take: according to founder Billy Markus, the currency only took three hours to create. In an interview, he said that he used the Control-F function to replace Bitcoin references to Dogecoin, though he later made some adjustments to further the concept, such as changing the name from mining to digging and adding the one-minute block time to differentiate with its competitors. Although some have said that this means there’s no cap to the supply of coin, meaning the supply of the coins can inflate infinitely, it has a decreasing inflation point at roughly five billion. The currency uses a Proof-of-Work consensus algorithm for security and relies on a scripting technology that helps to prevent the high-powered Bitcoin mining rigs. As a result, it’s only possible to dig for Dogecoin using dedicated FPGA and ASIC devices. As the currency is less competitive than Bitcoin, and developers did not perform a pre-mine, it’s fairer and offers users a level playing field, no matter their initial investments.
Other reasons why Dogecoin appears to be a more attractive upfront investment for users is that one Bitcoin now costs $50,000 - for those considering investing in a cryptocurrency, that means they have to negotiate within at least three decimal places, purchasing “scraps” of a coin rather than a whole coin. Dogecoin, on the other hand, costs just a few cents per piece and has the potential to transpose Bitcoin in the years ahead. Its current market position makes it a more palatable option for those new to crypto-exchange; rather than buying a small percentile of a currency, you can add hundreds or thousands of coins to your wallet. Right now, Bitcoin has just 21 million coins available, whereas Dogecoin has 128 billion coins in circulation; it could overtake Bitcoin and become the number-one cryptocurrency if adopted by consumers in the coming years.
As Marques Brownlee points out in his recent Dogecoin : the growth in Dogecoin is truly only just beginning. In the months and years ahead as consumers increasingly gravitate towards new forms of currency - and major brands accept digital currencies to boost sales and appease demand - we’ll likely see Dogecoin front and center. If you’re ready to make an investment, head to your favorite exchange platform and search for the coin. It’s possible to purchase the cryptocurrency using a debit or credit card, and you can store the currency inside of an iOS app (like ZenGo), a macOS app , or a physical hardware wallet such as the Ledger Nano X. The benefit of using a hardware wallet is that your cryptocurrency can be stored offline in “cold storage” for months or years, making it impossible for bad actors to access your holdings or steal your stock.
Dogecoin has enjoyed a truly incredible journey from its humble beginnings back in 2013, and though there’s no guarantee the currency will reach the heady heights of Bitcoin just yet, the phenomenal backing it’s had from celebrities, influencers, and the media no doubt gives it a strong chance of success. A single tweet and a powerful micro-community on Reddit changed the fortunes of this currency overnight - now it’s up to you to decide what’s next…