Currency name(s): Dogecoin (DOGE)
Genesis Block: December 2013
Total Supply: The total supply for Dogecoin was capped at 100 billion. However, the team decided not to limit the supply of Dogecoin, so for the time being the maximum supply is infinite and there are no intentions to limit it
Algorithm: Scrypt proof-of-work
Features: decentralized, peer-to-peer digital currency, community-supported, small transaction fees
Created as an homage to the widely popular internet meme of a Japanese Shiba Inu dog, Dogecoin was created as a simple joke with no inherent value at the time of its creation. However, the team that started it in 2013 soon realized that users could actually make this token useful, so the vision was set for Dogecoin to become an everyday digital currency people could use freely on the internet to make purchases, transfer funds, and even tip users on other websites for the content they created. Dogecoin was never intended to transfer large sums of value across the web, but rather be used as a fun everyday token unlike Bitcoin which is now seen as a more legitimate asset. Also, due to its almost infinite supply, the Dogecoin token is seen as inflationary rather than a deflationary which is not great for the long-term monetary value of the coin.
The Dogecoin network and blockchain system are based on Litecoin (which we covered in this previous market analysis), both of which are partially based on the Bitcoin network, meaning they are both tradable and mineable and the funds are transferred from one entity to another in a peer to peer manner. However, unlike Bitcoin’s SHA-256 algorithm, Dogecoin uses Scrypt proof-of-work algorithm, and the team has made it faster than Litecoin’s and much faster than Bitcoin’s when it comes to adding new blocks onto the blockchain.
As we mentioned above, the Dogecoin network uses the same algorithm as the Litecoin network when hashing, mining and adding new blocks onto the blockchain. That algorithm is widely known as Scrypt, but Dogecoin’s variant is faster than Litecoin’s. Namely, the Litecoin network’s new blocks are processed and added to the network in roughly 2 minutes, while Dogecoin’s block processing takes around 1 minute to execute all the necessary actions.
The Scrypt algorithm was also put in place in order to prevent the excessive mining of the token, as this algorithm needs large amounts of RAM to be used for hashing new blocks within the chain. It is also capable of preventing DoS attacks (Denial-of-Service), as well as spam attacks as this particular algorithm’s computations, take a long time to be carried out.
Although it started as an internet meme to conform to the then internet culture and offer a humorous approach to the cryptocurrency community, the Dogecoin network has evolved in a full blockchain network and has become a digital currency that can be and actually is used in everyday transactions. Unlike Bitcoin tokens which are now seen as an investment, Dogecoin is used for more common transactions, and many stores across the globe accept it as a payment option. It has been in existence for almost 6 years now, and that is a formidable achievement, especially as the cryptocurrency community has gone through several phases where many promising networks/projects have failed.
In our Dogecoin market analysis, it was surprising to us that a small but supportive community was able to push the Dogecoin network to a much larger audience than anyone thought possible. A cryptocurrency network that started as an internet joke is now sitting comfortably in the top 30 most valuable cryptocurrencies, and has been for awhile, with a market cap of around $530 million. The current price for one Dogecoin token is $0.0045 and it is experiencing minor daily fluctuations for the time being. The maximum price per token ever measured so far was in January 2018, at the height of the cryptocurrency boom, where it was sitting at around $0.018. The lowest price per token recorded was in May 2015 where it was traded for only $0.000085.
Currently, both cryptocurrency trading pairs, as well as fiat currency trading pairs, can be found on various markets if one would like to trade Dogecoin. Upbit, Bittrex, and Gate.io offer cryptocurrency trading pairs, and Dogecoin can be bought for Bitcoin, Ethereum as well as Tether. On the other hand, Coinsbit and Livecoin have fiat currency trading pairs, and Dogecoin can be traded for US dollars.
Below is a sample of some of the past work that BBA has done on the DOGE/BTC market in order to illustrate the kind of value that we provide to full members:
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