What is Dogecoin?: The 'Joke' Cryptocurrency that’s Worth $51 Billion

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What is Dogecoin?: The 'Joke' Cryptocurrency that’s Worth $51 Billion​

Some of the best things are invented by accident. A blockchain network that started as a joke and was inspired by a Shiba Inu meme is now worth $51 billion!
The price of Dogecoin (DOGE) has reached new highs against both fiat currencies and bitcoin. Read on to find out more about DOGE!

What is Dogecoin (DOGE)? 🐕

Dogecoin's story starts with the Doge meme, pictures of the Japanese dog breed Shiba Inu with comedic broken dialogue in the Comic Sans font.

The Doge meme originated on Tumblr in 2013, derived from a photograph taken in 2010 and was ranked the top meme of 2013 by the Know Your Meme website
The popularity of these memes led to a joke on Twitter about 'investing in dogecoin' by Jackson Palmer on November 27, 2013. After some encouragement from his friends, Palmer pursued the creation of a fun, light-hearted version of Bitcoin (BTC) for a laugh.

The face of the original Shiba Inu meme was used as the coin's logo, and Palmer set out acquiring the dogecoin.com domain. The website caught the attention of Billy Markus, who reached out to Palmer and they worked together to create Dogecoin (DOGE), which was done in a few hours.

Dogecoin was initially modelled on LuckyCoin, a coin where the block rewards are random for each block (instead of being fixed) and is based on Litecoin. Along with Dogecoin, these coins all use Scrypt mining, with faster block times and quicker transactions than Bitcoin.

The Dogecoin network was first introduced to the world through Bitcointalk on December 6, 2013, but little did the two creators know that their coin would far exceed their expectations. DOGE went from a joke to quickly becoming a favourite method for tipping in online communities such as Reddit, as it's easy as typing '50 doge'.
DOGE also became a favourite of cryptocurrency traders before stablecoins were created. Because of Dogecoin's fast transactions and cheap fees, cryptocurrency traders could use the altcoin to move funds to and from different exchanges quicker than they could with BTC.

The Dogecoin community also earned a reputation for philanthropy - not just tipping a few coins here and there on the internet, but also bigger projects which attracted mainstream attention. For example, some charitable campaigns include helping the Jamaican bobsled team to attend the Sochi Winter Olympics in 2014, and Dogecoin Socks, a project to donate socks to the homeless. The founders also donated all of their coins to charitable causes. At a time when Bitcoin was perceived as the coin of the 'bad guys' (because of the association with The Silk Road), Doge was positioning itself as the 'good guy' of crypto.

Despite being launched almost 8 years ago, Shibes are still digging for Dogecoin and the meme-powered blockchain network has recently been enjoying a major resurgence. The Dogecoin price reached fresh highs against both bitcoin and the US Dollar in April, moving into the top 5 coins by market capitalization once again.

Why is DOGE on Fire at the Moment? 🔥

DOGE has always had a strong social aspect and active community; it has one of the largest cryptocurrency-related Reddit forums (with over 1.4 million subscribers), it enjoys lots of Twitter activity (with the official account Dogecoin account amassing over 865,000 followers), and has displayed strong growth in the number of active addresses - which shows the number of users is increasing.

In the past year, the social dimension of DOGE was strengthened even further by several factors:

  • a Tik Tok campaign in the summer of 2020 to push DOGE to $1,
  • the GameStop short squeeze, which sparked more interest in investing,
  • the post-pandemic cryptocurrency bull run, and
  • Elon Musk tweeting about DOGE, bringing more awareness to the altcoin and attracting new users.
Over the past week, the social buzz for dogecoin is almost as high as it is for Bitcoin, with almost 1.8 million tweets versus Bitcoin's 1.97 million according to LunarCRUSH. Data from BitInfoCharts also shows that the number of tweets per day for Dogecoin has overtaken Ethereum and Litecoin, and is catching up with Bitcoin.

Of course, social sentiment is not everything, but if this trend persists, then it could bode well for Shibes. However, if the buzz dies down and falls out of step with other top 10 coins, then the upward move may fade.

While chatter on social media is one thing, Dogecoin is also getting a boost via endorsements from none other than Elon Musk, the CEO of Tesla and SpaceX/Neuralink founder.

From tweeting he's taking Tesla private at $420 to his appearance on the Joe Rogan Experience podcast, Elon Musk is a walking, talking meme himself, so it is fitting he'd muster his support behind another powerful meme, Dogecoin. Musk first publicly displayed his affection for DOGE in April 2019, when he said that the altcoin is "pretty cool":
 

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