Dogecoin is a cryptocurrency that began to gain recognition thanks to a meme that depicted a so-called “dog”, i.e. a Shiba Inu dog. It’s an interesting story that stands in stark contrast to the rigid and serious world of finance. The project that was a joke turned out to be one of the largest cryptocurrencies in the world by market capitalization. This is a perfect example that unconventional methods can bring huge benefits.
What should you know about Dogecoin?
Dogecoin considering other cryptocurrencies, this is not the latest project as it was established in 2013. This is a company that was a joke from the start and was designed to ridicule the risky speculation in the cryptocurrency market. However, this joke turned out to be very well received by the community and in the first month of its existence, Dogecoin gained many followers. As a result, the popularity of cryptocurrency with a charming doge image exceeded all expectations, and in 2014 Dogecoin’s turnover even exceeded the volume of Bitcoin, as well as all other cryptocurrencies combined. . It’s an incredible success considering we’re talking about a project made for a joke.
Dogecoin is a cryptocurrency that works similar to Bitcoin in that it also uses the Proof of Work consensus algorithm. Translating this into simpler layman’s language, it means that Dogecoin digging is possible. Initially, random prices were provided for each block mined, but as early as March 2014, a fixed amount of 10,000 units was set. It should be added here that the supply of Dogecoin is unlimited. It is therefore a currency that is exposed to inflation. Another interesting fact is that the inflation rate of Dogecoin will decrease over time. In 2015, it started from 5% and in 2035 it will only reach 2%. The inflationary nature of the coin is not good news for long-term investors, but it must be admitted that the inflation percentage is still low, especially compared to the values of some fiat currencies. Another important point to keep in mind is that DOGE is a project that has no real use, it is a purely speculative asset.
The price of Dogecoin in December 2013 increased several times in 72 hours (from 0.00026 USD to 0.00096 USD). Shortly thereafter, however, the valuation fell rapidly by 80%. This increase and decrease, however, is not much compared to what happened a few years later. In 2017, during the boom DOGE Award reached the impressive price of $0.079, and in May 2021, this record was almost increased tenfold, placing the ATH at the level of $0.73. This means that everyone who invested in Dogecoin a few years earlier saw lucrative returns in 2021. It should be noted, however, that in the first half of 2022 the rate dropped significantly, again reaching the limits of January 2021 (0 .07 USD). Thus, a 90% drop has been recorded since the ATH! Given this, it is safe to say that Dogecoin is a cryptocurrency that has seen both dramatic increases and equally dramatic decreases in its short history.
Overall, there’s no denying that Dogecoin has an interesting history. The project which appeared as a joke turned out to be a huge success. These are certainly positive aspects of this coin, but it should also be borne in mind that the lack of real utility of the coin and the fact that it is subject to speculation makes it an extremely risky asset, which makes difficult to predict its future. .