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What is Dogecoin? The $34 billion cryptocurrency that started as a joke. Explained!

What is Dogecoin

what is Dogecoin According to CNBC, software engineers Billy Markus, and Jackson Palmer created the digital token in 2013 as a faster but “fun” alternative to Bitcoin. It began as a satire on the numerous fraudulent cryptocurrency coins that had sprung up at the time, and it takes its name and logo from a Shiba Inu meme that went viral several years ago.

what is Dogecoin , Dogecoin — a cryptocurrency founded in 2013 as an internet parody — has risen in value in tandem with the virtual currencies Bitcoin and Ethereum this week.

Dogecoin, which is based on the “Doge” meme and began as a “fun” alternative to Bitcoin, has risen dramatically in value this week, adding around $19.9 billion in the last 24 hours and is now valued at $34 billion, according to CoinGecko, a market data site. The digital token was valued at 28 cents in the United States on Friday, more than doubling its value from the previous day. It is a top-10 crypto token with a 300 percent seven-day rise.

 

Unlike Bitcoins, which have a maximum possible number of 21 million (which is expected to be reached by 2040), Dogecoin numbers have no upper limit. There are already more than 100 billion in existence.

When the cryptocurrency first gained traction, the online community that supported it drew attention by supporting unusual causes, such as sponsoring Jamaica’s bobsled team at the 2014 Winter Olympics. That year, the Dogecoin community donated $55,000 in digital tokens to a Nascar driver in the United States.

So, what is behind Dogecoin’s rise?

The main reason for Dogecoin’s meteoric rise is the same one that has propelled the value of Bitcoin and Etherem – Coinbase’s listing this week, the most popular virtual currency exchange in the US.

After going public on Wednesday, Coinbase’s market cap briefly reached $100 billion, and the values of Bitcoin and Etherem reached $64,000 and $2,500, respectively, during the week. This frenzy is said to include Dogecoin.

“Doge” also has a fervent supporter of Tesla CEO Elon Musk, whose frequent tweets have contributed to the digital token’s craze. Musk’s Twitter bio was once changed to “Former CEO of Dogecoin.” Other celebrities, such as rapper Snoop Dogg and rock musician Gene Simmons, have promoted it on social media as well.

Another reason for its current success is a Reddit group called SatoshiStreetBets, where members built up an enthusiasm for cryptocurrency in a similar way that led to GameStop’s rise earlier this year. Satoshi Nakamoto, the screen name of the person or group of people behind Bitcoin, is referenced in the group’s name.

Why some are concerned

Some investors are concerned that Dogecoin’s rise will result in a bubble, because buyers see no meaningful value in the digital token and are only trading to profit while the price rises.

Cryptocurrencies are considered highly volatile because they lack intrinsic value, such as land or gold, and can crash as quickly as they can rise, according to experts, making them vulnerable to sudden scares as well as manipulation by small groups who frequently hold large amounts of the virtual currency in circulation.

Source : TheIndianExpress

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