Dogecoin (DOGE) is a popular meme-inspired cryptocurrency launched in 2013 to mock the top digital currency, Bitcoin. It is a peer-to-peer open-source cryptocurrency, but its use case was limited to raising crowdfunding or casually transferring among some crypto enthusiasts who wanted to take part in the growing crypto buzz. With little to no relevance in offering real value or solving a problem, Dogecoin was deemed a casual, fun digital currency with the popular Shiba Inu as its logo.
But little did people, and even its creators, know that its valuation would hit the billion-dollar mark. Dogecoin surprised many when this supposed joke currency hit the $2 billion market cap in January 2018. It is then that Dogecoin attracted enormous attention and investment from across the world. If this has got you thinking too and tempted you to buy Dogecoin in India, you should know this digital currency more before making any investment. To make things easier, we’ve listed down all the essential information that investors should know before including it in their portfolio.
Dogecoin was created in 2013 by the duo Billy Markus and Jackson Palmer. While Jackson wanted to make a digital coin to satirize the growing hype around cryptocurrency, Billy wanted to launch a digital currency to become an active participant in this new, evolving space. Dogecoin’s code was taken from Luckycoin, which was originally derived from Litecoin. This digital currency used Litecoin’s scrypt technology and used a randomized reward for block mining in the early stages.
When this coin was finally launched in the crypto space on 6th December 2013, its value soared by a whopping 300% within two weeks. It gave the creators a lot of confidence in Dogecoin, and they started to work on it seriously. It is why Dogecoin has become pretty popular over the years, and today almost everyone knows about it.
How does Dogecoin Work?
As cryptocurrencies like Bitcoin, Ethereum, and others, Dogecoin also uses blockchain as its underlying technology. For the uninitiated, blockchain is a decentralized network that facilitates secure transactions throughout its system. The system uses cryptography to record all the transactions happening in the Dogecoin network securely.
Dogecoin is also known as the Proof-of-Work (PoW) coin as miners mint Dogecoin by solving complex mathematical equations and using the same process to approve transactions and record them in the system. Miners are rewarded for each such activity in the form of Dogecoin that they can either hold or sell in the open market for full profits.
Though people can use Dogecoin to make payments and purchases, not many do it. Despite its huge popularity, Dogecoin still has a little store of value. Another reason why serious, long-term investors don’t bet high on Dogecoin is that this digital coin is highly inflationary by design. It means that any miner can mint any Dogecoin he wants and distribute it in the market. When something is unlimited in supply, its price can crash at any time, especially during situations of excess supply.
Is it Worth Buying Dogecoin?
Though this cryptocurrency has a very little store of value, its investors have made profits out of it. If you want to leverage its popularity and generate profits, you might want to hold it as a short-term investment. Many people have purchased Dogecoin out of FOMO but failed to generate the profits they were expecting. However, you can also come across investors who made wise decisions by selling it at the right time and generating huge profits.
Whether you’ll profit from a cryptocurrency or not will depend on your timing of purchasing and selling it. You can always refer to its price or value chart over the years, but it won’t be able to help you much because even single negative news can bring down Dogecoin’s value like it has happened several times in the past. If you’re a risk-taker and want to indulge in short-term crypto trading, you can consider buying Dogecoin.
Best Platform to Buy Dogecoin
If you have decided to buy Dogecoin, be sure to purchase a reputed crypto exchange platform. A good crypto exchange platform comes loaded with various features a crypto trader may need for making smooth transactions. Start with an exchange that supports several cryptocurrencies, not just the popular ones, so you don’t face difficulty if you decide to diversify your crypto portfolio.
Also, check if the platform provides easy cashing out or conversion options at nominal fees. It will allow you to convert your Dogecoin in INR within minutes and at a reasonable price. Consider posting exchange-related queries on Facebook groups or subreddits on cryptocurrency, inviting unbiased opinions from real crypto traders on the best exchange platforms, to begin with. It will make much of your work easier, ensuring you buy and sell Dogecoin on the best exchange.
Trade like a Pro
Cryptocurrencies like Dogecoin are still new to many people, and they are trying their best to learn more about it. But if there is one standard string connecting all these digital coins is its volatility. No one can predict the best time to purchase or sell Dogecoin, but you can try trading based on your intellect and the knowledge or understanding you get of this coin from your surroundings or the market. Now that you’re not new to Dogecoin, you should be able to make better trading decisions compared to absolute newbies.