The world of cryptocurrency still is the wild west of financial products. Popularised by the insanely high valuation of Bitcoins (BTC), Dogecoin (DOGE) is one of the crypto coins on offer. However, the commodity’s origin and its rise are a matter of much intrigue, and we shall take a deeper dive to understand how the coin operates and what sets it apart from traditional crypto currencies.
Snarky Origins
Starting off as a joke, dogecoin was made by Jackson Palmer, a product manager working for Adobe in Sydney, Australia. He created the crypto as a joke and a way to satirize the existent hype around the cryptocurrency scene in general. This is demonstrated by his snarky tongue-in-cheek tweets during the early days of Doge. However, things took a turn for the better with positive social media attention and the eventual buyout of dogecoin.com.
On the other end of the planet however in Portland, Oregon, a software developer at IBM, Billy Markus has had the vision to create a digital currency for some time now but couldn’t figure out a way to promote his efforts. Upon hearing about the surging popularity of Doge however Markus offered Palmer to build the actual software behind the dogecoin.
Dogecoin in its current form was programmed and created as a peer-to-peer open-source cryptocurrency. Playfully labelled by enthusiasts as a memecoin, DOGE was launched in December 2013 and had the image of Shiba Inu dog as its logo.
The fun and playful aspect of the crypto pandered to the young carefree demography of enthusiasts and by late 2017 Doge was already participating in the global crypto bubble. However, since the bubble burst in 2018, doge lost a lot of value but retained a core group of supporters who were trading and using the coin basically to tip creators and content on platforms such as Twitter, Reddit, and YouTube.
The Doge Technology
We all know at least a little bit about how blockchains work, dogecoin too works on the same technical principles. Markus based the code of Dogecoin on luckycoin, which happens to be a derivative of Litecoin and subsequently Bitcoin itself. Litecoin’s involvement with the development of Dogecoin has been significant to say the least as dogecoin uses Litecoin’s Scrypt technology and borrows the Proof-of-Work concept from Bitcoins. However, unlike BTC Markus started off with a randomized reward system in the beginning which was eventually transformed to a static reward in March of 2014.
The Meteoric Rise
With the allure of being fun and exciting, Doge’s casual and Laissez-faire system appealed to the attitude of the steadily growing crypto enthusiasts’ community. The fuel that would set Dogecoin on its mission to moon however would be its scrypt technology and its unlimited supply which facilitated a more robust and user-friendly variation of the Bitcoin itself.
Unlike Bitcoin which is by design deflationary and is thus good as a store of value and not as a currency, Dogecoin is an inflationary coin just like fiat currency. In bitcoin’s case at the end of every four years the amount of BTC released into the market will be slashed in half till all the coins would be released of which there are 21 million!
However, Dogecoin and other such deflationary coins are not as good when it comes to storing wealth, but they do exceptionally well when it comes to being used as a currency. This would explain the rapid rise in DOGE’s market capital being up all the way to $20 million.
The Dogecoin community itself is a closely knit and wholesome group of individuals as illustrated by their charitable efforts. The Dogecoin community donated 27 Million Dogecoins amounting to $30,000 in order to fund the Jamaican bobsled team’s participation to Sochi Winter Olympic Games. In March, the community again came together to build a well in Kenya worth $11,000 using Dogecoins and other such charitable endeavours.
The Bottomline
So, where is DOGE headed? Is it a joke or does it have any value behind it? Well, we must understand that what might start off as a joke may not necessarily stay as one. The technology that goes behind the operations of Doge is as solid as any other Crypto. However, only time will tell if we shall ever reach a stage of mass adoption and Doge will go to the moon!