Dogecoin is a peer-to-peer cryptocurrency based on a Shiba Inu dog meme that went viral on the internet. At first, the crypto project was created solely to mock other cryptocurrency projects that were being launched at the time, but it quickly grew a devoted fan base that discovered and developed new use cases for it. It is regarded as the first "meme coin," as well as the first "dog coin."
The underlying technology of Dogecoin is LuckyCoin, a fork of Litecoin. As such, Dogecoin, like Litecoin, employs the Scrypt algorithm and operates on a Proof of Work (PoW) consensus mechanism. Dogecoin claims to be significantly faster and less expensive than Bitcoin. For example, it can process approximately 33 transactions per second, compared to approximately five transactions per second on the Bitcoin network.
In 2014, members of the Dogecoin team started the Dogecoin Foundation, a non-profit, to provide support, governance, advocacy, and trademark protection for the token. However, the Foundation became inactive with time and was eventually dissolved. In 2021, the Foundation was relaunched with a board consisting of members of the core team and seasoned industry players, including Ethereum co-founder Vitalk Buterin, as advisors.
While native token, DOGE, was initially developed without any vision for its utility, its use as a payment method has increased over the years. As of September 2022, over 2,000 merchants across the globe accepted DOGE as payment. To this day, Dogecoin has one of the strongest and most vibrant online communities in the crypto space.
Dogecoin uses a Proof of Work (PoW) blockchain that was cloned from Litecoin's network and uses the Scrypt mining algorithm to validate transactions.
New DOGE tokens are created in the same way that Bitcoin and many other cryptocurrencies are, through a computationally intensive process known as mining, in which computers compete to be the first to solve complex mathematical problems in order to verify transactions and secure the blockchain network. When users solve these problems correctly and contribute to the security of the blockchain network, they are rewarded with new DOGE.
Dogecoin's blockchain network allows users to send DOGE to other users anywhere in the world without the need for a financial intermediary to process the transaction. Transactions made over the network are permanently recorded and cannot be erased or reversed. Dogecoin's network can process up to 40 transactions per second, making it faster than Bitcoin's. It also has much lower transaction fees than Bitcoin.
Dogecoin has gained the support of many crypto enthusiasts as well as prominent celebrities over the years. The Dogecoin Foundation, the project's management team, has been relentless in developing new features and maintaining the project to improve its utility. Dogecoin has also influenced many other popular cryptocurrencies, which are now referred to collectively as "meme coins."
Dogecoin had a limited supply of 100 billion coins at first. This was later changed to an infinite supply. As a result, Dogecoin is inflationary, which means that its supply, which is currently 132 billion as of September 2022, will only grow over time.
New DOGE tokens are created in a computationally-intensive process known as mining. DOGE's circulating supply equals its total supply, indicating that all tokens are in the hands of users and the development team reserved none. Each year, 5 billion new DOGE tokens are created, giving the cryptocurrency an inflation rate of around 4%, a low figure compared to other inflationary currencies.
Dogecoin was created by Billy Markus, an IBM software engineer, and Jackson Palmer, senior director of product management at Adobe.
Shiba dog memes had been around for a while, and the popular meme drew attention to the token. According to Palmer, the meme aided in the accessibility of cryptocurrencies at a time when Bitcoin was viewed as shady and linked to the dark web. Dogecoin sparked public interest in learning more about cryptocurrencies.
In 2015, Palmer left the cryptocurrency world and denounced the way people were making money from crypto. Palmer's departure came after Ryan Kennedy, also known as Alex Green, convinced the community to donate towards the creation of a Dogecoin exchange called Moolah. Later, it came to light that Kennedy had used the donations to purchase $1.5 million worth of Bitcoin, which in turn funded his expensive lifestyle. As a result, Kennedy was convicted of fraud in 2016.
The Dogecoin Foundation, the non-profit organization that maintains the network, has worked with a host of high-profile individuals and companies over the years. In 2021, they began working on a staking mechanism in partnership with Vitalik Buterin, one of the founders of the world's second-largest cryptocurrency by market cap, Ethereum.
The team has also worked with billionaire celebrity Elon Musk. An avid Dogecoin fan, Elon Musk has pioneered the acceptance and use of Dogecoin in his multi-billion dollar companies, Tesla and SpaceX, and has promised future collaboration with the team to enhance the utility of the Dogecoin network.
Celebrity entrepreneur and billionaire, Elon Musk, has often publicly displayed his strong interest in and support for Dogecoin. Elon Musk, known to be an avid fan of memes, has endorsed the project several times, often sparking massive user interest and optimism, along with wild speculation. He usually takes to Twitter, where he has a sizable following, to express his positive views and hope for the meme coin.
The "Dogefather," as he is called, began showing his support for Dogecoin in late 2020 in a tweet and has continued to tweet and talk about Dogecoin ever since. Due to Musk's status and popularity, the price of Dogecoin usually spikes significantly (as much as 100% in one case) whenever he mentions it.
Musk has not only expressed his favorable views of the project but has even taken steps to promote it. He heralded the acceptance of Dogecoin by Tesla, the largest automaker in the world—a company that he runs. Another one of his companies, SpaceX, announced that they would be funding a rideshare mission to the moon completely in Dogecoin, making the mission the first of its kind.
He has also crowdsourced ideas for the development of Dogecoin and even promised to work with Dogecoin's development team to make improvements to the blockchain. His actions could also be said to have inspired other famous celebrities and influential people, such as Mark Cuban and Snoop Dogg, to support Dogecoin.
Musk's actions, however, have not been welcomed by all. He has often been accused of manipulating Dogecoin with his tweets, including by Jackson Palmer, the co-founder of Dogecoin, who abandoned the project in 2015.
1. Dogecoin Gigawallet
The Dogecoin team has often reiterated its commitment to ensuring that Dogecoin has utility beyond just being a popular meme. As such, they have embarked on several projects to improve the usefulness of the meme coin. One of these is Project Gigawallet, which aims to build an enterprise-grade service that can be easily integrated by merchants to accept and process Dogecoin transactions.
2. The Dogecoin standard and Libdogecoin
The Dogecoin standard is a set of documentation aimed at reducing the learning curve for developers and helping them understand how Dogecoin works. Meanwhile, Libdogecoin is a software library aimed at allowing developers to use all kinds of tools to build for the Dogecoin network, eliminating the need for them to have extensive knowledge of how Dogecoin works.
3. Acceptance by Tesla and SpaceX
In January 2022, automaker Tesla began accepting DOGE payments for merchandise in its store, as announced a month earlier by CEO Elon Musk. The price of DOGE spiked 11% as the feature went live. Musk has also announced on Twitter that its supercharging station in Santa Monica will soon be accepting DOGE.
He has also announced that aerospace company SpaceX will also begin accepting DOGE payments for their merchandise and will fund a mission to the moon called DOGE-1 with DOGE. Several other notable companies, like AMC, have also followed suit in their acceptance of Dogecoin.
4. Acceptance by the Dallas Mavericks
In March 2021, billionaire Mark Cuban announced that the popular NBA team, the Dallas Mavericks, would be accepting DOGE for ticket and product purchases. In just two days, about 20,00 transactions were carried out in DOGE by the Mavericks.
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Alternatively, visit our new OKX Crypto Calculator. Select DOGE and the desired fiat that you would like to convert to view the estimated live conversion price.