Although the world’s most well-known and traded cryptocurrency is Bitcoin (BTC), thousands of alternative coins (altcoins) are available on the crypto market. Some of the highest-valued altcoins today are Ethereum (ETH), Ripple (XRP), and Tether (USDT).
However, one altcoin stands out from the rest, appreciated more for its community and identity than for its value: Dogecoin (DOGE). Learn everything you need to know about Dogecoin, how DOGE became relevant, and how to buy, sell, and trade Dogecoin today.
How Dogecoin Came into Existence
Dogecoin is one of the earliest cryptocurrencies. It was first introduced by software engineers Billy Markus and Jackson Palmer in December 2013, almost five years after Bitcoin. Markus, an IBM employee, and Palmer, an Adobe software engineer, sought to create a peer-to-peer digital currency with broader mass appeal than Bitcoin.
Dogecoin’s visual identity is based on the well-known Doge meme (pronounced “Dohj”). The frequently-shared internet meme depicts Kabosu, a Japanese Shiba Inu dog first posted online in 2010.
The meme rapidly gained notoriety in 2013 on multiple internet forums and social media platforms, and Dogecoin was launched at the meme’s height in popularity.
Properties as a Cryptocurrency
According to Markus and Palmer, Dogecoin was never intended to be anything more than a joke based on a popular meme. Despite that, Dogecoin is a classic cryptocurrency with properties similar to many other, larger coins.
Like Bitcoin, Dogecoin is based on blockchain technology and is mined through a proof-of-work (POW) algorithm, rewarding miners with 10,000 coins per block mined. Dogecoin is also notable for its short block time: 1 minute, unlike Bitcoin’s 10 minutes.
However, unlike many other cryptocurrencies, Dogecoin technically has no upper supply limit. Although the currency started with a supply limit of 100 billion coins, the 100 billionth coin was eventually mined in mid-2015.
In response, Palmer lifted the supply limit and introduced controlled annual inflation. Now, the Dogecoin supply receives 5 billion additional coins every year. As of 2022, the current supply of Dogecoins was estimated at 132.67 billion coins.
Valuation and the $1 milestone
Like many other coins, Dogecoin is available on most cryptocurrency exchanges, represented by an official code (DOGE) and a currency symbol (Ð). As of February 24, 2022, Yahoo Finance estimated the value of 1 DOGE at approximately $0.12, with a 24-hour trading volume of about $1.8 billion.
Although it reached an all-time high of $0.6890 on May 7, 2021, the coin’s valuation is considered highly volatile and subject to frequent and sudden changes.
One of the most popular Dogecoin community topics is whether the cryptocurrency will reach the milestone of $1 per coin within a specific time frame. Some market analysts believe that Dogecoin may eventually reach $1 sometime in the future, and many high-profile individuals, such as Tesla CEO Elon Musk, are known Dogecoin fans and traders.
How to Buy Dogecoin
If you’re looking to invest in Dogecoin and start making your first Dogecoin transactions, the process is relatively simple. You must meet three basic requirements:
- Possess a Dogecoin wallet
- Find a crypto exchange platform that trades Dogecoin
- Make your first Dogecoin transaction
Choosing a Dogecoin Wallet
A Dogecoin wallet is simply a cryptocurrency wallet that supports Dogecoin. When choosing a wallet for Dogecoin, the two best long-term options at your disposal are software wallets and hardware wallets.
A software wallet is a program or an application installed on your computer, tablet, smartphone, or another compatible device. These wallets are encrypted and require a key or a password to access.
Software wallets are convenient and relatively simple to use, allowing you to use your existing devices to hold cryptocurrency with no additional requirements. However, they are more vulnerable to security issues. When using a software wallet, it is critical to practice good password security and keep your recovery keys secure.
Hardware wallets are single-use physical devices resembling USB drives. Like a standard USB drive, you can connect your hardware wallet to a computer or another compatible device to access and trade your Dogecoins. Once stored, you can disconnect the hardware wallet, effectively unplugging it from the Internet and keeping your coins secure.
Hardware wallets offer better security than software wallets. They are hacker-proof as long as they remain unplugged from any of your devices. However, hardware wallets are a costly investment and are vulnerable to the same dangers as regular paper money wallets; they can be misplaced, lost, or stolen like any other physical object.
Find a Crypto Exchange Supporting Dogecoin
Once you have a wallet, it’s time to look for a cryptocurrency exchange platform that supports Dogecoin trading. However, it is important not to buy DOGE on the first platform you see.
Here is a list of recommendations to follow for finding a safe and secure exchange:
- Establish a list of exchanges that offer Dogecoin. Search for crypto exchanges and verify whether they support DOGE.
- Check whether the exchange platform you’re interested in lets you trade in your country. Many exchanges restrict users from specific countries or entire regions from trading crypto.
- Verify that the exchange you’re interested in is compliant with local laws, mainly anti-money laundering regulations. Legally-compliant platforms are safer and more likely to help users if your funds go missing.
- Look into the exchange’s reputation by searching for comments by other users, news stories covering the platform, and whether it is known for being reliable and trustworthy or not.
- Check the platform’s list of trading fees and other price premiums, and prioritize platforms with the lowest fees.
What Can I Do With Dogecoin?
Besides speculating on its value (buy low, sell high) or exchanging it for another currency, you can spend Dogecoin in several different ways, some of which may surprise you.
One of the most common ways to use Dogecoin is tipping online content creators on popular social media and video sharing platforms, such as Reddit, Twitter, Twitch, or Facebook. Dogecoin is practical for tipping due to its relatively low value and ease of recognition.
Many online retailers and companies accept Dogecoin for buying goods and services. For instance, Kronos Advanced Technologies, a clean air technology company, became the first publicly-traded company to accept DOGE in May 2021. Other notable businesses known for accepting Dogecoin include Tesla Motors, Iron Rail Diner, Travala.com, and AllGamer.net.
Get Financial Advice with Finance is us
If you’re new to crypto trading or need insight to ensure you’re making the correct decisions, use valuable online resources from Finance is us. We offer financial information to help you make the best and safest investment decisions, navigate insurance and banking jargon, and make the most out of your money.
Disclaimer: All content on this site is information of a general nature and does not address the circumstances of any particular entity or individual, nor is the information a substitute for professional financial advice and services.