Beginners guide to blockchain XIIII: What is Dogecoin?
Hello again and welcome to this new article of Beginners Guide to Blockchain.
In this article, we will be talking about the well-known meme-coin cryptocurrency called Dogecoin.
But before we start you should know I write a lot of articles like this that might be interesting to you, here are some of them:
Read them here:
- What is Bitcoin?
- What is Blockchain?
- What is Ethereum?
- What is Defi?
- What is an NFT?
- What is a DAO?
- What is an Altcoin? What is an ICO?
- What is Web 3.0?
- Crypto Dictionary (other terms you need to know).
- What are the real risks in crypto?
- What is Decentralization?
- Who is Vitalik Buterin?
- Who is Satoshi Nakamoto?
Now that you are ready, let’s get right into it.
First of all let’s start with the question “what is a meme coin?”, well a meme coin (sometimes written memecoin) is a cryptocurrency that was inspired by an Internet meme or has another funny feature.
They are sometimes also known as shitcoins depending on if they have a valid project behind them or not.
Let’s continue with the big question:
What is Dogecoin?
Dogecoin is a very well-known meme cryptocurrency, hitting the market in late 2013, and becoming an instant hit.
Within two weeks after the launch, the r/Dogecoin Reddit channel had over 19,000 users and DOGE’s price skyrocketed by 300%.
Nowadays Dogecoin is known as the original meme coin, it was initially made to make fun of the crazy speculation that lives in cryptocurrency markets but it quickly made its own community and has already grown to a market valuation of $7 billion.
Dogecoin can be used to make payments and purchases, but it isn’t a very good store of value. This is because there is no lifespan limit on the number of Dogecoins that can be mined, making the cryptocurrency very inflationary by design.
How does Dogecoin work?
Like most cryptocurrencies, dogecoin runs in its own dedicated blockchain, and its network uses cryptography to keep it safe.
The Dogecoin blockchain has a proof of work consensus method, in which miners use computers to solve really hard mathematical equations for them to process and record transactions on the blockchain.
Miners then receive more Dogecoin in return for supporting the blockchain, which they may then keep or sell on the open market.
The blockchain also pays miners for their efforts by producing millions of new Dogecoins every day, making speculative price rises in Dogecoin difficult to maintain over time.
If you would like to hear more crypto-related stuff, make sure to follow @bychrispace on Twitter and on pretty much all other social media.