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Evolution Of Dogecoin (DOGE) & What Makes It Unique?
Who would have imagined a meme would be so widespread that it would generate an idea of a cryptocurrency in itself. Yes, Billy Markus and Jackson Palmer. These two software engineers had invented the proposed system of a spoof payment system. Their ideal motive behind it was to joke around about the cryptocurrency system in its time, but eventually, this system has later been widely accepted as a valid investment.
This form of cryptocurrency seems to be highly volatile due to the Floating nature of the Exchange rate.
What Is Dogecoin (DOGE)?
Like the way the Pound is based upon Currency and Bitcoin is based upon blockchain, with hypothetically assured to bring a revolution in the world’s monetary system.
Whereas the Dogecoin is literally based upon a meme, a meme of a dog that went viral around the world in 2013. This is because cryptocurrency is an extremely decentralized form of currency that almost anyone would compose their own coin with some basic coding skills. People went gaga over Dogecoin, as a matter of fact, famous personalities like Elon Musk have also bought Dogecoin. With the rise in popularity of Bitcoin, it also came with its own flaws, to point a few; long transaction time; being environmentally toxic due to its excessive consumption of energy.
How Does Dogecoin (DOGE) Work?
To eradicate the issues faced by bitcoin, new alternate coins are formulated, simply known as “Alt-Coins’ ‘, one such form of altcoin is Dogecoin. This coin is based upon an alt-coin named Litecoin, the benefit of Litecoin was it consumed lesser processing time and charged a very little transaction fee.
As of today 2021, Dogecoin is the world’s 7th largest cryptocurrency.
Now you may think, if all this has been made out as a joke, then why is it so popular and how is its valuation increasing over time? The answer to this starts from the very famous website ‘Reddit’. Yes, whenever someone liked any comment or post, in particular, one would send them a few dogecoins as a tip. Usually 5 Dogecoins in general. This was called the Dogebot tip. Its value at that point of time was about 1 Doge = 0.0002 cents.
Dogecoins were so extremely shared as tips and this form of currency exchange later led to increasing its valuation rapidly. In September 2018, the CEO of ‘Tesla’, Elon Musk had noticed this pattern. Elon Musk then met Jackson Palmer to discuss and eradicate the ongoing issue of Twitter spambots as he was indirectly being degraded. 7 months later he tweeted that Doge might be his favourite currency. Later tweet after tweet regarding the issue, the value of dogecoin was observed to rise as much as 25% to 50% just by a tweet of Elon Musk.
Eventually, there came a point where its valuation had touched 80 Billion Dollars. Its valuation does face ups and downs but experts believe and aim for the valuation of 1 Dogecoin = 1 Dollar; which means the value of a dollar is the same as a dogecoin.
How To Buy Dogecoin (DOGE)?
Now how shall one buy a dogecoin you think? It’s quite simple, it is just the same way we buy any other cryptocurrency out there, i.e through cryptocurrency exchange platforms. Some of the most popular platforms are Coinbase, Gemini and Binance to name a few.
Why To Buy Dogecoin (DOGE)?
Well the reason to buy a Dogecoin is quite debatable but two main reasons as to why one opts for it are:
1- Volatile but tremendously high growth rate.
2- Donating for social causes.
We know how rapidly it has been growing and some experts believe that it can fetch huge returns in the coming future, technically more than what real estate can yield and faster than any other forms of ROI (Return of Investment) if invested now.
Apart from just financial returns, investing in Dogecoin, makes us a contributor to the positive aid to global problems, to consider that, The Dogecoin team who are nonetheless the people on the official Reddit page of Dogecoin who buy and promote Dogecoins, made their first donation of about $25-30K in the form of Dogecoins to a Jamaican Bobsleigh team which would be of major support for them to reach the Russian Winter Olympics of 2014. Apart from that, the Doge community has also donated about 14 million Dogecoins for Kenya’s water conservation projects and the support of specially-abled children.
How Many Dogecoins (DOGE) Are In Circulation?
While in the current scenario there is no limitation on the number of Dogecoins to be created but as of May 2021, it is estimated that well above 130 Billion Dogecoins are being circulated while its Total Market Capitalization is over $50 Billion.
Wrapping up
Should You Invest In Dogecoin (DOGE)?
We now know the pro’s of Dogecoin but we must also keep in mind that Dogecoin has started as a joke which later evolved as a ‘Cultural Trend’.
Cultural trends historically rise at a tremendously fast pace which definitely increases their value and exponentially yield more returns in a short span of time but the complication with any cultural trend is that every trend would have its own saturation period and once it has reached its apex, there are high chances for it to fall, either gradually or maybe overnight.
Subsequently, nobody could ever predict when this trend would be out of fashion, which is a major criterion to make a rough estimate of its peak time.
Once fallen, one cannot even predict if it would rise back or not because Dogecoin doesn’t withhold any practical value in itself which would be helpful for the long term such as technological advancement etc. but rather as a wave by circumstances at that point of time.
Overall, Dogecoin is immensely volatile but high risk fetches higher returns and vice versa. Hence it’s a calculated risk investment based upon the cultural trends and the amount of value society feels it beholds to be invested upon.
Want to know how other cryptocurrencies like Bitcoin work? Head to Zeen blog.
