Coin Highlight

Coin Highlight: Dogecoin (DOGE)

5 minutes

History

DOGE coin has the honour of being one of the first altcoins ever created. In 2013 doge coin was created by Jackson Palmer, a Product Manager at Adobe Inc in Sydney, Australia. The coin was originally created as a satire of Bitcoin and cryptocurrencies in general. Many have noted the appeal of DOGE coin is its total honesty, DOGE does not claim to change the world as many other currencies do. It is just DOGE and that is all it is aiming to be. This has created a devoted community that continues to support the coin from inception through to today. DOGE is mostly kept afloat due to this dedicated community and is used mainly as tips for content creators and in crowdfunding projects.

Purpose

Firstly, DOGE coin started as a fork of a fork, thus contributing to its reputation as a 'joke' coin. It was a fork of Luckycoin (now non-existent), which was a fork of Lietcoin. This means that DOGE uses the same blockchain protocol as Litecoin. The original goal of DOGE was to create a crypto currency that could be traded and used by a wider ordinance than Bitcoin. Appealing to those who were not natural investors. It was a dream of Mr Palmer to develop a fun and simple crypto that would be a counter balance to 'boring' traditional banking systems while also offering low fees and instant transactions.

Features

DOGE coin is one of the easiest coins to start mining. Dogecoin operates on the same blockchain as Litecoin, allowing it to be mined freely alongside LTC.

It is also important to note that Dogecoin does not have a Max token supply cap meaning it’s an inflationary token that can be infinitely mined. This makes it simple and easy for individuals to mine DOGE and LTC simultaneously, allowing for an easier and more profitable venture compared to other more complicated coins. This mirrors the casual approach DOGE coin is attempting to establish compared to other coins on the market. These factors combined make DOGE an easy to use currency, perfect for social media users and content creators.

Under the Hood

Dogecoin works in a similar way to both Bitcoin and Litecoin. DOGE uses a custom Proof-of-Work algorithm. Proof-of-Work is a form of cryptographic proof that involves the miner creating the coins, which is the work, and users on the network then validate the blocks in the ledger providing the proof. However, unlike Litecoin which requires increasing amounts of processing power the more miners there are contributing to the blockchain, DOGE's difficulty stays the same. This ensures a steady flow of DOGE into the market.

The Proof-of-Work or PoW rules are followed through the use of nodes on the blockchain operated by miners. Each node uses processing power to solve increasingly complex mathematical problems. Once each one of these problems have been solved, a new block on the chain is created and verified, which awards the miner responsible with 10,000 DOGE coins. Unlike Bitcoin, where the original rewards were extremely large, but slowly dropped over time, DOGE has always had a constant subsequent reward of 10,000 DOGE per block solved. This is why many Litcoin miners also mine DOGE.

Applications

DOGE has many practical applications which adds to its popularity among everyday users. Currently DOGE is mainly used to tip Reddit and Twitter users as well as content creators. It is also accepted by some major companies, such as the Dallas Mavericks, who allow fans to purchase merchandise and tickets using their DOGE. SpaceX has also hinted at accepting DOGE payments in order to fund a satellite launch in 2022. Projects such as these are what makes the DOGE community so special and different from what would be considered traditional cryptocurrencies. Although DOGE may have started as a joke, it is now one of the most widely recognised coins on the market. In 2021, DOGE recorded almost 5000% returns and was endorsed by a few major celebrities.

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