Within months, what started as an internet joke quickly became one of the most highly valued cryptocurrencies. Spurred on by its base of online supporters, Dogecoin quickly changed from a joke to something very real.
What is Dogecoin?
Even if you are unfamiliar with internet meme culture, you have probably heard about Dogecoin in recent months. Pronounced “dohj-coin,” it is a cryptocurrency that facilitates individual transactions through a decentralized network. Like its predecessor Bitcoin, you can get coins by solving math puzzles.
However, Dogecoin was never intended to be a legitimately traded digital currency. It combined the concept of blockchains with a popular internet meme featuring a Shiba Inu that spoke in monosyllabic words that appeared in comic sans font. Its creators never dreamed it would blow up like it did. Rather, they expected Dogecoin to quickly die off once the novelty of the joke wore off.
Where Did Dogecoin Start?
Dogecoin was born from a joke between two software engineers from opposite sides of the globe. Jackson Palmer, who describes himself as your “average geek,” was working as an Adobe software engineer in Australia when he came up with the idea. He combined two wildly popular cultural phenomena – the Doge meme and cryptocurrency – to create Dogecoin.
Meanwhile, an IBM software engineer, Billy Markus, had been developing a new cryptocurrency derived from Litecoin. Markus was looking to appeal to a broader market interested in more than profits. After posting the idea for Dogecoin, Markus tweeted at Palmer, expressing his interest to work together. Both men thought it was funny, so they ran with the joke and made an actual coin stamped with the meme. In December 2013, the pair launched Dogecoin and it soon gained traction among the Reddit community.
How Is Dogecoin Different from Other Cryptocurrencies?
While many speculate that Bitcoin will revolutionize monetary transactions in the 21st century, Dogecoin is a meme that has been stamped on a coin. Its founders never had plans to compete with larger cryptocurrencies. Markus and Palmer created Dogecoin as a joke. It was never designed to serve any other purpose that to get a few laughs.
Like other cryptocurrencies, you mine the coins by completing math puzzles. However, the rewards are entirely random. You could earn anywhere from a single coin to several hundred coins for each one you solve. Furthermore, there were no limits on the number of coins the system could produce.
How Did Dogecoin Become More Than a Joke?
Although Dogecoin started out as a joke, that was all about to change. Reddit threads quickly picked it up and users began trading it as a source of kudos and thanks for comments. After the introduction of the “tipping bot,” stock prices soared as people continued tipping each other with Dogecoin. However, as they shared the cryptocurrency, it greatly expanded the user base and increased its value.
One week after it launched, Dogecoin become the second-most used cryptocurrency for internet tipping. The community grew as it created mining pools and normalized trading Dogecoin between members. One reason for its widespread popularity comes from the Internet sub-culture that prides itself on its irreverent attitude towards corporate America and Wall Street. The fact that it started as a joke is partially what helped drive the buzz about it.
Another factor that helped legitimize Dogecoin as a viable cryptocurrency was the famous people attaching their names to it. Dogecoin was no long a joke when it was validated by a $1.5 million investment from Tesla. Memes and social media posts from celebrities like Snoop Dogg, Soulja Boy, and Gene Simmons further popularized it. Elon Musk even posted one himself with a spoof fashion cover titled “Dogue.” Following a string of tweets as well, Dogecoin shares skyrocketed nearly 1,500% this year.
What is the Current Value?
Dogecoin hit a new milestone in 2017 when it reached $2 billion. However, it now has an estimated market value around $10 billion. Its stocks are worth more than Under Armour, Western Union, and Xerox.
When the markets opened on January 1, 2021, Dogecoin sold at $0.0057 per share. Within a few short weeks, it peaked on February 7 at $0.0788. Since the beginning of the year, the valuation has stabilized, closing at $0.055 on Friday, March 12.
What Can I Use Dogecoin for?
Even though shares are only worth about a nickel each, you can still buy and sell Dogecoin. As long as you have a credit card, you can purchase it through cryptocurrency exchanges and trading apps. Any exchange where you can trade Dogecoin will also convert it into traditional currencies as well.
Although cryptocurrency has not yet become a standardized form of payment for most major retailers, it is still worth something. You can trade in your Dogecoin at dogeswag.com for a wide selection of doge swag apparel. There is also the option to redeem gift cards at Bitrefill.
What’s the Future for Dogecoin?
Dogecoin’s rapid rise was primarily driven by Reddit users. However, when profiteers began taking over and driving up its valuation, both founders quickly got out of the venture. Both Palmer and Markus have distanced themselves from the cryptocurrency, especially after the Moolah debacle.
Instead, the founders have given all their Dogecoin to charity initiatives to use Dogecoin as force for good. When the Jamaican bobsled team qualified for the Winter Olympics in 2014, they set up a Dogecoin address on subreddit and raised $25,000 for them. They have also raised money to build wells in Kenya and train service dogs for autistic children.
When questioning the future of Dogecoin, I look at how the creators view it themselves. In an interview, Markus stated that he doesn’t “think it solves anything. If anything, it exists as an educational tool. It’s a reminder that we can’t take this stuff seriously. ”
What we can all learn from Dogecoin is that future of cryptocurrency remains uncertain. Until it becomes a widely accepted for retail transactions, it will always be vulnerable to the market’s volatility. As Markus advised, “keep educating yourself as much as you can on how cryptocurrency works, how these markets work, never risk more than you could safely lose, be vigilant and aware.”
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