What is Dogecoin Cryptocurrency? Its History, and Future

Curious to know what is Dogecoin? Well, it’s a digital currency that originated as a joke but has now evolved into a real player in the cryptocurrency industry. You read it correctly: a joke developed into a cryptocurrency with a market valuation of more than $30 billion. 

But what is Dogecoin, and why has it become so popular in recent years? 

FYI, Dogecoin is a peer-to-peer native cryptocurrency that is open source. It is a fake cryptocurrency inspired by a Shiba Inu dog viral internet meme (an old Japanese dog breed that became popular as a meme in 2013).

This article will go into the realm of Dogecoin, looking at its history, features, and controversy. So, if you're wondering What is Dogecoin and want to understand more about this famous cryptocurrency, read on!

What is Dogecoin (DOGE) Cryptocurrency?

Dogecoin (DOGE) was developed as a fun alternative to existing cryptocurrencies such as Bitcoin. Unlike Bitcoin, which was supposed to be limited, Dogecoin is designed to be numerous, with 10,000 new coins generated every minute and no maximum supply.

For most of its existence, Dogecoin (pronounced "dohj coin") was regarded as a funny "meme coin" treasured by its community but with little monetary worth. 

This changed in 2021, when DOGE became one of the largest cryptocurrencies by market cap, with a total value that surpassed $80 billion, even though each individual coin is worth pennies.

Some of the fundamentals of Doge are:

• Dogecoin is based on the Scrypt algorithm, which enables faster and easier transaction confirmation compared to traditional blockchain technology.

• The cryptocurrency is a direct clone of Litecoin's code and can be used to transfer value over the internet.

• Dogecoin was initially created as a simple blockchain-based payment system without any real-world utility.

• Despite this, it quickly gained a loyal fan following that discovered and built new applications for it.

• One of these applications was a third-party online tipping service, which made Dogecoin a major tipping coin on Reddit.

• Dogecoin was also used to fund humanitarian causes, showcasing its potential for social impact.

As of now, you got a Gist of What is Dogecoin but that’s not the end, it’s more than What is Dogecoin to know about the most famous meme token.

How Does Dogecoin Function?

A proof-of-work consensus mechanism, similar to the one Bitcoin uses, is used by Dogecoin's blockchain to enable network users to agree on the data that will be added to the blockchain.

The original mining code for Dogecoin was taken from LuckyCoin, another cryptocurrency project.

“LuckyCoin: a fork of Litecoin, which is a fork of Bitcoin, had a totally random block reward schedule, meaning that miners might get nothing for creating new blocks or perhaps hundreds of free coins."

Dogecoin Ambiguity

Palmer and Markus felt that dogecoin miners would find the randomness annoying and discourage them from utilizing the token over the long term.

However, as the dogecoin community evolved, Palmer and Markus ultimately chose to switch to a fixed block reward schedule in March 2014.

10,000 dogecoin were found in each block made under the new timetable, which means 5.2 billion Dogecoins being mined annually. Unlike Bitcoin, which makes adjustments every 2,016 blocks, Dogecoin's mining difficulty adjustment, which determines how difficult or easy it is to locate a block, is adjusted every block.

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Charlie Lee, the founder of Litecoin, first suggested combining Dogecoin and Litecoin mining in 2014. According to the concept of "merged mining," miners would simultaneously mine Litecoin and Dogecoin. That would contribute to improving Dogecoin's network security.

Four months later, Palmer and Markus agreed to Lee's proposal. As a result, Dogecoin generated blocks quicker than Bitcoin (1 minute vs. 10 minutes), resulting in much faster Doge transactions than Bitcoin transactions.

Up to this point, now we know, What is dogecoin and how it works. In the next section, we are going to discuss how Dogecoin gets its value as it’s not from thin air.

What Gives Dogecoin Value?

The value of Dogecoin, like any other asset, is determined by the market's interaction of supply and demand. Because the supply of Dogecoin is large and ever-growing, demand has to skyrocket in order to drive prices as high as they have recently.

The rise in demand for Dogecoin happened in the first few months of 2021, driven by Reddit retail investors working together to push prices up, the overall crypto boom, and months of seemingly tongue-in-cheek comments from Tesla founder Elon Musk, accentuated by his appearance on Saturday Night Live.

The media coverage and social media posts about the rapidly growing DOGE prices in 2021 produced a cycle that attracted additional investors and pushed prices even more. Due to FOMO, or "fear of missing out," this cycle of escalating demand resulted in waves of new traders entering the market.

Till Now we have covered almost half of the What is Dogecoin guide. If you missed something yet just scroll up and have a quick read.

Dogecoin Vs Bitcoin

Dogecoin was established five years after Bitcoin and uses some of Bitcoin's original code. Here are some key distinctions between Dogecoin and Bitcoin:

Market capitalization

Bitcoin's market capitalization (the coin price multiplied by the number of coins in circulation) is roughly 47 times that of Dogecoin. Bitcoin has far fewer coins in circulation but a considerably higher coin price.

Transaction Times

When it comes to transaction processing times, Dogecoin outperforms Bitcoin. Dogecoin takes around one minute to add a new block of transactions to the Dogecoin blockchain, making the Dogecoin network more than nine times faster than Bitcoin.

Because the Bitcoin blockchain is more popular in general, Bitcoin is more likely than Dogecoin to encounter network congestion.

Transaction Fees

The cost of executing a Bitcoin transaction is substantially more than the charge for processing a Dogecoin transaction. Dogecoin and Bitcoin have various transaction fee structures as well. 

Bitcoin users can pay a greater fee to have their transaction completed quickly, or they can pay the same price regardless of the transaction's value.

In the next section, we will see what is dogecoin used for. So, better you take note of that so you can spend your Doge wisely.

What is dogecoin used for?

One of the reasons for Dogecoin's rising user base is its popularity as a profitable investment. As a result, practically all popular crypto channels, including exchanges, wallets, and free market enterprises, accept Dogecoin trades. Below are some of the main factors describing What is dogecoin and its use cases:

E-commerce/online retailers

Cryptocurrency collaboration with e-commerce companies may be traced back to Bitcoin's earliest use case as an asset. Years later, many e-commerce sites no longer refuse to take cryptocurrency as payment. The number of establishments that accept Dogecoin as payment is also growing.

Because of the global reach of e-commerce firms, Dogecoin can be used to make purchases from anywhere in the globe using services that provide worldwide delivery. Before doing business with an unknown platform or vendor, it is critical to investigate their credibility.

Trading platforms

When it comes to third-party platforms, cryptocurrency exchanges allow Dogecoin to be purchased, sold, or swapped for other cryptocurrencies or fiat currencies. Such exchanges are often used by cryptocurrency users to transfer local currencies, such as the US dollar, into crypto holdings.

Crypto exchanges show cryptocurrencies coupled with cash or notable cryptocurrencies such as Bitcoin and Tether, depending on the local jurisdiction and popularity of tokens (USDT). Users can buy Dogecoins at the spot (or current market) price by selling an equivalent amount of dollars or Bitcoin.

DOGE Community

Dogecoin has a large community of users that mostly use DOGE to tip online content providers. Dogecoin is also used for crowdfunding, frequently organised within the DOGE community, and as a payment method for quick blockchain-based transactions with low fees.

These mentions are not the only platforms for What is dogecoin used for but some of the basic mentions.

Dogecoin’s History and Key Events 

2013

• Dogecoin is launched in December and quickly gains popularity.

• The r/Dogecoin Reddit channel gains over 19,000 users in just two weeks.

• Despite China's restriction on payment businesses working with Bitcoin, the price of DOGE surges 300%.

• Dogecoin's name is inspired by a viral internet meme and a list of recently added cryptocurrency projects.

• Dogecoin's creator posts the now-famous sentence, "Investing in Dogecoin, quite sure it's the next big thing."

2014

• The tipping platform DogeTipBot is developed, allowing users to reward each other with Dogecoins for positive content.

• More than 70,000 people sign up for DogeTipBot, making it the most popular tipping service in the cryptocurrency sector.

• The Dogecoin community donates over $170,000 in DOGE to charitable projects.

2015

• Dogecoin's creators Palmer and Markus leave the project, branding the community "toxic".

2018

• Dogecoin's market value passes $1 billion.

2021

• The "wallstreetbets" Reddit community gains widespread attention and new supporters, including for Dogecoin.

• 08 May 2021, Dogecoin reaches its All time high of $0.68 after Elon Musk’s SNL.

• Price Declined severely after SNL and dragged DOGE to $0.33.

2022

• Crypto Winter took prices down to $0.19.

• FTX collapse had the worst effect on Doge. Prices succumbed to $0.059 almost 97% down from its ATH.

• Price recovered from $0.05 to $0.12 after the market slowdown.

Dogecoin and Elon Musk

The dissident horde of stock pumpers didn't take long to start searching for the next hip thing to pump, and dogecoin with a significant presence in online pop culture was an obvious choice.

After Musk entered the debate by posting a parody image of "Dogue" magazine to his 54 million Twitter followers, doge's price increased by 142% in 24 hours and by another 200% after that.

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Since then, Musk, who now refers to himself as the "Dogefather," has been in part responsible for driving up doge prices by posting references to and memes about the canine-themed cryptocurrency on his social media page.

Early in 2021, Musk tweeted about Dogecoin and shared a DOGE meme featuring the Lion King. That sparked a ferocious DOGE surge that ended in Musk's participation on Saturday Night Live, albeit with brief dips.

Despite Musk's assurances that DOGE's price would skyrocket following the SNL appearance, the stock crashed. Musk appeared to lose interest in the project in the months that followed, and DOGE's price has since fallen by nearly 70% from its peak. However, as evidenced by sporadic tweets, Musk continues to control Dogecoin.

The Shiba Inu-inspired tokens were created on BNB Chain and Ethereum on November 1, 2022, in response to a relevant tweet from tech magnate Elon Musk. 

After Musk posted a picture of a Shiba Inu dog in a Twitter T-shirt in front of a traditional Halloween pumpkin with the social media platform's bird logo inscribed on it, names like "babyDogeTwitter," "dogenaldtrump," "spaceTwitterDoge," and "elonDogeTwit" littered the two blockchains.

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The Dogecoin Advisory Board

Members of the Dogecoin team established a non-profit foundation in 2014 to offer governance, support, advocacy, and trademark protection for the cryptocurrency project.

But over time, the foundation crumbled.

The foundation was restarted in 2021 with a "renewed focus on supporting the Dogecoin Ecosystem and promoting the future of the Dogecoin Blockchain" after going dormant for a while.

The project's board of advisors now includes some seasoned business professionals in addition to some of the initial core team members, and they will meet once a month to discuss matters pertaining to Dogecoin.

Billy Markus, the creator of Dogecoin, Max Keller, Vitalik Buterin, the creator of Ethereum, and Elon Musk, who is represented by Jared Birchall, the head of the Musk family office, make up the advisory board.

The Board of Advisors members will serve in a variety of roles. Markus will be in charge of the community and memes, with Keller acting as the project's technical advisor.

Buterin will serve as the foundation's blockchain and cryptocurrency advisor, and Birchall will serve as Elon Musk's legal and financial advisor.

The Board of Advisors' first task will be to seek three years of funding to hire a small, committed team to work on Dogecoin full-time. Volunteers have been responsible for the ecosystem's upkeep thus far.

What Was The Price History Of DOGE?

• From December 2013 to December 2020, the price of Dogecoin was essentially unchanged.

• In January 2014, Dogecoin briefly outperformed Bitcoin and all other cryptocurrencies combined in terms of trading volume.

• On May 6, 2015, Dogecoin momentarily reached its lowest price at $0.0000869.

• Dogecoin's price momentarily increased in early 2018, however, it quickly suffered the same fate as other cryptocurrencies as the crypto market crashed after the bitcoin meltdown (also known as the 2018 cryptocurrency crash).

• In January 2021 following Elon Musk, CEO of Tesla Comments on January 28 and 29, Dogecoin's value rose by around 339% to $0.032642 in January 2021.

• On May 8, 2021, with a price of $0.682 per Dogecoin, the cryptocurrency briefly reached its highest price since its existence.

 

Source: GlobalData

Direct Mining of DOGE, No ICO

The creators of dogecoin didn't conduct a public sale or "pre-mine" coins prior to the debut of the currency. Instead, a 100 billion coin maximum total supply was established, and anyone with a laptop or smartphone could start mining doge right once.

The block reward schedule of dogecoin was another distinctive feature. The doge block rewards followed the LuckyCoin project's timetable, which was fully random.

This meant that the reward for mining a single block may range from 0 to 1 million Doge. For every 100,000 blocks, the range of coins accessible as block rewards were reduced.

Block Reward was Set to 10,000 DOGE per Block

Until 2014 when the founders of the project chose to switch the block reward mechanism to a fixed timetable. After then, the reward for successful mining was 10,000 doge each block.

Only two brief, significant price increases occurred for Dogecoin over its nearly four years on the market.

The first occurred within a few hours of the token going online, when its price rocketed 1,061% in just 15 days, from $0.0002 to $0.0023.

The second significant increase happened in March 2017, at the start of a bull market for cryptocurrencies. Doge's price increased by 1,494% to reach a high of $0.004, which was the highest price it has ever attained.

Dogecoin Price Prediction

This year has seen a considerable change in the entire cryptocurrency market capitalization, including the Dogecoin market cap. After the DOGE price achieved its ATH, it had a large drop in the long run; however, recent Dogecoin price movements have seen drastic improvements. In just one week, the price of DOGE increased by more than 100%.

Dogecoin Price Prediction 2022 

According to a technical study of Dogecoin pricing in 2022, the minimum cost of Dogecoin will be $0.09999. The DOGE price can rise to a maximum of $0.109989. The anticipated average trade price is $0.109989.

Dogecoin Price Prediction 2023

According to an analysis of Dogecoin values in recent years, the minimum price of Dogecoin in 2023 is expected to be around $0.149985. The most likely DOGE price is about $0.179982. In 2023, the average trade price might be $0.149985.

Dogecoin Price Prediction 2024

According to cryptocurrency specialists' technical analysis of Dogecoin pricing, DOGE is anticipated to have the following lowest and maximum prices in 2024: around $0.209979 and $0.249975, respectively. The projected trading cost is $0.209979 on average.

Dogecoin Price Prediction 2025

The prices of Dogecoin and their changes over the previous years have been studied by cryptocurrency experts. The minimum DOGE price in 2025 is expected to be $0.29997, with a high price of $0.369963. The trade cost will be about $0.309969 on average.

Dogecoin Price Prediction 2026

According to crypto specialists' study of Dogecoin costs, the following maximum and minimum DOGE values are projected in 2026: $0.519948 and $0.439956. It will be traded at $0.459954 on average.

Dogecoin Price Prediction 2027

Dogecoin swings are continually being studied by cryptocurrency experts. According to their forecast, the average DOGE price will be around $0.629937. It could fall to a low of $0.609939, but it could still reach to $0.749925 by 2027.

Dogecoin Price Prediction 2028

Every year, cryptocurrency analysts anticipate the price of Dogecoin. DOGE is expected to trade between $0.939906 and $1.07 in 2028. Throughout the year, its average cost is estimated to be roughly $0.959904.

Dogecoin Price Prediction 2029

Cryptocurrency specialists are ready to reveal their price predictions for Dogecoin. The maximum DOGE price of $1.62 will define the year 2029. However, it is possible that the rate will fall to approximately $1.28. As a result, the anticipated average trading price is $1.33.

Dogecoin Price Prediction 2030

After years of studying Dogecoin pricing, crypto specialists have arrived with their DOGE price prediction for 2030. It will be traded for at least $1.84, with a possible high of $2.24. As a result, the DOGE price in 2030 is expected to be roughly $1.90 on average.

Note that Changelly is the source of the aforementioned Dogecoin's pricing forecasts. This is only an informative addition to our material and is in no way intended as investment advice.

Is Dogecoin a good long-term or short-term investment?

Some market observers regard Dogecoin as a short-term speculative asset in which investors profit from price fluctuations. Nonetheless, Dogecoin is one of the top 10 cryptocurrencies and is becoming more popular.

As we said in our early price forecasts, many experts are optimistic about Dogecoin's future, which could imply that it's a worthwhile long-term investment. To spread the risk, investors should try diversification and merely devote small amounts to cryptocurrencies.

How Are Dogecoins Mined?

Dogecoin is protected via mining, just like more well-known cryptocurrencies like Bitcoin and Ethereum. Thousands of machines compete to mine Dogecoin, validating and processing network transactions while sharing the millions of additional coins added to the supply each day.

In the early days of Dogecoin, any machine could be utilized for mining DOGE. However, as demand has grown, mining competition has risen, making it challenging for small-scale miners to use standard technology.

A miner may be able to earn Doge using a computer that runs Windows, Mac, or Linux and has a potent graphics processing unit (GPU), but mining profitably is likely to require a more potent, specialized computer called an ASIC.

Dogecoin can be mined either independently or by joining a mining pool. Since the mining of Dogecoin and Litecoin was combined in 2014, both currencies can now be produced.

What Are Dogecoin Risks Of Ownership?

Unlimited supply: Dogecoin doesn't have a limited quantity, unlike Bitcoin and many other cryptocurrencies. This means that prices depend on consumers continually purchasing new dogecoin that is released into circulation in order to sustain their worth.

High issuance rate: Dogecoin features a constant block reward, meaning that successful miners receive 10,000 dogecoins every minute, as opposed to Bitcoin, which pays miners 6.25 bitcoin every 10 minutes until that rate is halved again sometime in 2024. 

• In the end, this means that 28 million more dogecoins will be in circulation in two days than there will be in the whole quantity of bitcoin, which will cap out at 21 million around the year 2140.

Infrequent technology development: A team of volunteer developers who manage Dogecoin's technological development has, up until recently, produced relatively few code upgrades and releases.

CoreConcentrated ownership: Data from IntoTheBlock shows that nine wallets, with one wallet controlling 28% of the total, collectively hold more than 40% of all dogecoin.

• The price may drop at any time if one of those big investors decided to sell, or they could influence the market by taking advantage of their size.

• As opposed to this, there is just one active Bitcoin wallet that is home to slightly more than 1% of the total supply.

Dogecoin's Future 

DOGE's value had earlier surged in January before falling back, sank in mid-April after a rebound, then rose again to a time high of $0.6953, then went on to reach as high as $0.73. The coin's volatility is frequently influenced by social media, where there is presently speculation that the price may rise further to $1.

Essentially, no one can predict the price of Dogecoin or any other cryptocurrency given the level of volatility in the crypto market. One thing certain of is that a price increase for Dogecoin is definitely possible. Given the enthusiasm around Dogecoin as a cryptocurrency, these projections may not be accurate enough.

When it comes to cryptocurrency, the most crucial factor is a project's popularity. And Dogecoin has a large following. In fact, aside from Bitcoin, it has one of the strongest communities.

Hope this guide on What is Dogecoin has imparted the best knowledge to you and will guide you through your investment journey on Memecoins.

Dogecoin FAQs

Where will Dogecoin be in five years?

DOGE price forecast indicates that the maximum value for Dogecoin will be $0.51, while the minimum value for the same time period may be as low as $0.35.

Is Dogecoin a secure currency?

Although Dogecoin was infamously first created as a joke, investors now treat it very seriously. It is a highly dangerous investment, though. Because of this, experts advise keeping your cryptocurrency holdings at 3% to 10% of your overall portfolio.

Does Elon Musk possess Dogecoin?

Although Tesla has been accepting Doge payments for select products on their website, Musk has previously disclosed that he personally owns Dogecoin but has not stated that the electric car manufacturer does as well.

Is it still a good idea to buy Dogecoin?

The likelihood is that DOGE is a great investment. More than 80% of Dogecoin's most recent all-time highs are now being traded. This suggests that at the current price, the risk-reward ratio is optimal. Additionally, the chances of DOGE's long-term growth are in favour because businesses like Tesla now accept payments in Dogecoin.

What Is Dogecoin's Libdogecoin?

Michi Lumin, a core developer for Dogecoin, announced the release of Libdogecoin, a C-library comprising the network's components. Developers might create Dogecoin-compliant products with Libdogecoin "without worrying about the underlying mechanics of the crypto functions." Numerous languages, including Python, Node.js, and Ruby, will be supported by Libdogecoin.

Which Businesses Accept Dogecoin?

Dogecoin has become a payment alternative for many conventional businesses as a result of its low transaction fees and ongoing support from Elon Musk. The following businesses currently accept Dogecoin payments: Tesla, AMC Theaters, GameStop, AirBaltic, Dallas Mavericks, EasyDNS, Newegg, and Twitch are just a few examples.

What Are Some Uses of Dogecoin?

On Reddit and Twitter, Dogecoin has mostly been used as a tipping system to encourage the creation and sharing of high-quality content. Dogecoin can be obtained from a Dogecoin faucet or by engaging in a community that accepts virtual money (a website that will give a small amount of Dogecoin for free to begin interacting in Dogecoin communities).

Where Can one Purchase Dogecoin?

Any exchange that offers Dogecoin allows users to sell or purchase it, keep it on the exchange or in a Dogecoin wallet, and tip using Dogecoin in any place that accepts it.