What Is Dogecoin In 5 Minutes
Get the run-down on the original memecoin, Dogecoin — a cryptocurrency driven by popular internet culture.
Updated March 24, 2022 • 3 min read
While Dogecoin (DOGE) began as a parody of cryptocurrencies, it has earned a significant market capitalization and widespread attention. Based on a fork of the Litecoin code, Dogecoin is a digital asset driven by popular demand, and serves as an accessible jumping-off point for crypto newcomers. The success of Dogecoin since its launch in 2013 has inspired the growth of many other memecoins, which have developed into their own entire sector of playful digital assets that prove the market value of internet culture in the digital economy.
What is Dogecoin?
Dogecoin (DOGE) owes its origin to a popular internet meme known as “Doge” that features a cartoon representation of a Shiba Inu (a Japanese dog breed) with scattered text displayed in Comic Sans font. Dogecoin went live in 2013, and its network is a fork of Litecoin, which is itself based on the code that underlies Bitcoin. While Dogecoin was initially created as a parody of the proliferation of altcoins that came into existence in the years following the original launch of Bitcoin, the DOGE crypto network has defied expectations in terms of its growth, fostered an active ecosystem, and proven the market value of internet culture in the digital economy. Thus, Dogecoin has played a pivotal role in the growth of memecoins in cryptocurrency.
Use Cases and the Dogecoin Crypto Community
Despite its markedly unserious origins, Dogecoin has developed an online following and a significant market capitalization. Presenting itself as the “fun and friendly” cryptocurrency, Dogecoin was increasingly bought and sold in online crypto marketplaces by those looking to add an atypical currency to their crypto portfolios. It experienced explosive growth in the first months of its release, which even resulted in it briefly exceeding the combined trading volume of all other cryptocurrencies (including Bitcoin) in January 2014. Continuing to defy odds, Dogecoin somehow managed to achieve a billion-dollar market cap without a whitepaper or any viable use cases at the time, cementing both a parodical and powerful status in the cryptocurrency community.
Rather than being used as a store of value, or as a platform for building blockchain-based applications, Dogecoin settled into a niche as a popular method for tipping online content creators with micro-donations, as well as supporting charitable organizations with much larger donations. The Dogecoin Foundation is a non-profit company through which the Dogecoin community has historically carried out charitable campaigns.
Dogecoin In The Media
Dogecoin was forged from popular internet culture, and it continues to maintain a reflexive relationship with social media influence. For example: In April 2019, Elon Musk said on Twitter that Dogecoin “might be my fav cryptocurrency. It’s pretty cool.” Many people believe this statement caused the cryptocurrency’s price to significantly increase. Similarly, between May 2020 and July 2020, the price of Dogecoin rose by almost 200% (from $.001571 to $.004398) after widespread publication of Dogecoin-related content from Dogecoin holders on the social media platform TikTok. In February 2021, billionaire investor Mark Cuban stated that he purchased some DOGE cryptocurrency for his young son in order to teach him crypto and investing principles in a fun, accessible manner.
Dogecoin Mining and Its Technical Structure
The Dogecoin crypto network relies on Proof-of-Work (PoW) mining to generate new DOGE and to secure the network. But unlike bitcoin (BTC) and litecoin (LTC), DOGE is an inflationary coin, meaning that there is no limit to how many DOGE coins can be mined. With Dogecoin mining, a new block is produced every minute, thereby mining new DOGE, which contributes in part to its notable market capitalization. The Dogecoin protocol was originally forked from the Litecoin protocol, and shares the latter’s Scrypt mining algorithm — which differs from the SHA-256 mining algorithm used by the Bitcoin protocol.
What is the Future of Dogecoin?
While Dogecoin (DOGE) began as a parody of cryptocurrencies, it has earned a significant market capitalization and widespread attention. Importantly, the DOGE crypto network continues to serve as a popular onramp for new investors entering the wide world of cryptocurrency, and its leading role in popularizing memecoins has helped develop a marketplace for assets driven by and for internet culture. While the project may have been launched in jest, what it proves about the value of memes is a formidable proposition for the emerging digital economy.
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