Dogecoin (DOGE) refers to publicly accessible and peer to peer cryptocurrency. DOGE was announced in Dec 2013 as a substitute cryptocurrency, with the logo of a ShibaInu dog image. Dogecoin’s blockchain has merit because this cryptocurrency uses Litecoin's main technology. Moreover, Dogecoin, which takes on the scrypt algorithm, is prominent for its little cost and unlimited supply.
Well, Dogecoin was primarily a whim; however, it rapidly got popular. At the end of the year 2017, this currency was taking part in the cryptocurrency fizz, which considerably improved the digital coins’ value.
Although Dogecoin underwent losses in the year back in 2018, a core of admirers still trades this cryptocurrency plus uses it to give a fee for content on Twitter &' Reddit. Besides, users can purchase and trade Dogecoin on virtual exchanges for ordinal currencies.
Where did (DOGE) Dogecoin come from
Software developers Billy Marcus and Jackson Palmer, friends from Reddit (who never met in-person), made Dogecoin (DOGE) as a joke in late 2013. In addition, they combined 2 then-currently-trending subjects in their digital community: a meme portraying a Shiba Inu and the growing digital currency Bitcoin and the misspelled word "dog."
Dogecoin turned out to be popular, with dogecoin.com having more than 1M visitors in its first month. Dogecoin's position as a full-fledged cryptocurrency featuring its blockchain network as well as a mining process similar to Litecoin's, added to its comedic demand. Due to its historically low prices (for long of its existence, DOGE could be purchased for pennies or less) and abundance, it has recently drawn investors' attention, anticipating its value will increase.
How has Dogecoin become valuable
Dogecoin price surged during the bubble that culminated at the end of 2017, then dropped along with other cryptocurrency markets in 2018.
In 2019, Dogecoin supporters rejoiced when the cryptocurrency exchange Binance featured the coin. Many people also believed Elon Musk, CEO of Tesla, Inc. (TSLA), had approved the currency in a cryptic tweet.
The infrastructure of Dogecoin has not received much attention from the community of coin developers. Dogecoin's vibrant mining community ensures it can continue functioning and being traded. Numerous Scrypt miners continue to favor Dogecoin over other cryptocurrencies like Scrypt PoW coins, according to Zachary Mashiach of CryptoIQ.
In 2021, Elon Musk publicly endorsed Dogecoin, saying he was collaborating with the currency's developers to increase transaction speed. The founder of SpaceX conducted a social media survey to determine whether Tesla should allow Dogecoin as payment.
With a market cap of $8.4 billion, Dogecoin had the 11th-highest market cap rating as of August 2022.
What is Dogecoin used for
Like other cryptocurrencies like Bitcoin, users can use Dogecoin to send money or be used as a medium of exchange for payments for products and services. Users can still make transactions autonomously if a record is visible to everyone on the blockchain. And they can make transactions directly without going through a conventional intermediary like a bank.
Dogecoin runs on a decentralized computer network that uses a blockchain, a distributed ledger. Imagine a blockchain as a continuously updated receipt of all currency transactions. The blockchain stores the data (almost) permanently after the computer network confirms transactions and guarantees the accuracy of the information.
Dogecoin Vs. Bitcoin
Dogecoin differs from Bitcoin in a few significant ways. Dogecoin is more rapid for payment processing because it's quicker and simpler for miners to solve the mathematical formulas that record and complete transactions on the blockchain.
According to Gary DeWaal, CEO of Katten's Financial Markets and Regulations group, the process to approve new blocks somewhat on the Bitcoin blockchain takes ten minutes. But it just takes one minute to ratify on the Dogecoin blockchain.
As there is a cap limit on the total number of coins that may be issued, Bitcoin is a deflationary cryptocurrency, and Dogecoin is an "inflationary coin." The number of Bitcoins released into circulation as mining rewards is halved every four years, and until all coins are issued, so is the inflation rate.
How to invest in Dogecoin
You can invest in Dogecoin using different websites, and your decision over which website to utilize to get Dogecoin will likely rely on your objectives:
- If you want to purchase Dogecoin just for speculation, you should choose an online brokerage that supports cryptocurrency trading, such as Robinhood.
- You can also trade the cryptocurrency on eToro and Webull; however, many other brokers don't support it. The broker will hold any investment you make in the cryptocurrency.
- You can use an exchange like Binance or Coinbase if you want to invest in Dogecoin to use it or to speculate on it. With exchanges, you may take possession of the asset and send or spend it as you like.
It's helpful to have a cryptocurrency wallet if you intend to use your holdings because it can provide additional security beyond what is often provided by an exchange.
Is Dogecoin a good investment in 2022
Cash flow or any assets don't support Dogecoin, like most cryptocurrencies (except stablecoins). That implies that the only factor determining the Dogecoin price is what others are willing to pay. In stark contrast, a stock's price appreciation over the long run is determined by how well the underlying company does. Dogecoin's price growth depends on investors being even more overconfident, or what is known as the "great fool theory of investing.
Due to these factors, legendary investors like Berkshire Hathaway's Charlie Munger and Warren Buffett avoid cryptocurrencies and counsel other investors to do so.
This does not imply that you cannot profit by trading Dogecoin. Instead, it is unlikely to hold value over the long term.
