The New Phenomenon: Dogecoin
The New Phenomenon: Dogecoin
Dogecoin is one of the original altcoins, which was created in 2013 by Jackson Palmer and Billy Markus after one of them made a joke about the next big thing in crypto assets market. From the technical perspective, Dogecoin isn’t very innovative because, like many early altcoins, it’s based on the original source code of the Bitcoin. It uses a Shiba Inu dog as its mascot and is based on a meme featuring the animal. In 2020, its value has risen more than 800% the year so far. Now, it is the 12th largest cryptocurrency with a market cap of $6.3 billion! (as of 4th of February) There are now 100 billion Dogecoin in existence, with as many as five billion new coins minted each year.
Dogecoins are "mined" in the same way as Bitcoins which are created using computer processing power. However, unlike Bitcoin which can be created only 21 million; there is no upper limit on the number of Dogecoins that can be produced. The quantitative amount in overall markets is ever-growing and potentially limitless. It can be bought and traded relatively easily on dozens of crypto exchange sites, including Binance, Kraken, Huobi, and Robinhood. Even if it started as a joke, investors are making a real and huge amount of money from it. The most famous coin platform Coinbase does not support buying of Dogecoin, but you can store Dogecoin in the Coinbase Wallet app.
The Tesla CEO has tweeted about Dogecoin a number of times since April 2019, when he tweeted, “Dogecoin might be my fav cryptocurrency. It’s pretty cool.” And as Musk has proven multiple times, his tweets can move markets—which has gotten him into legal trouble in the past as well. Last time, it has jumped in value by 50% after inventor Elon Musk dubbed it as ‘The people's crypto’! Furthermore, during a Clubhouse event, he said: ‘Dogecoin was made as a joke to make fun of cryptocurrencies, but fate loves irony. The most ironic outcome would be that Dogecoin becomes the currency of Earth in the future.’
The GameStop affair, the rise of Dogecoin after Musk’s twits, etc. show us how celebrities or high-profile social media users can move markets. If stakeholders would like to build a strong crypto market they should provide resiliency with boundaries, regulations, awareness, and not twitting about every single thing etc. Without these components, crypto currencies will not stand long as an alternative for traditional investment products. We will touch on more points about innovative moves in the crypto currency markets in the following articles. For any further questions, please reach us via contact@cryptoindexseries.com or visit our CryptoIndexSeriesTM Platform for a better analysis of the crypto market space.
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