Onboarding Notes: Dogecoin

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With Elon Musk’s recent acquisition of Twitter, you might’ve also heard about the surge in price action for Dogecoin.

But why did this happen? How is Twitter related to Dogecoin? Is Dogecoin simply a meme that will eventually become worthless? Or is it something more?

In this onboarding note, I share some introductions to this fan-favourite cryptocurrency, its developments over the years, and why there are mixed reactions to its success.

Let’s dive into how this coin, created as a parody, has garnered mainstream attention and a cult following today.

Origins of Dogecoin

Dogecoin was originally created simply as a joke, inspired by the “Doge” meme featuring a Japanese Shiba Inu cartoon.

It was created by Jackson Palmer and Billy Markus at the end of 2013, as a parody to the different alt-coins that were emerging after the launch of the Bitcoin network.

To the surprise of the founders, Dogecoin was a near-instant success and gained tremendous popularity. In fact, when Dogecoin was just 2-weeks old, it managed to reach more transactions per day than Bitcoin.

The Dogecoin meme and community started to grow rapidly, especially from a strong community following at Reddit. Reddit community members were tipping each other in Doge for providing interesting or insightful content.

The growth of Dogecoin

While the founders eventually left the development efforts in 2014, a Dogecoin Core Development team was formed and has been developing Dogecoin since.

As Dogecoin started as a joke, it makes the cryptocurrency seem a lot more accessible, less intimidating and more meme-able for the masses. As such, many have also seen Dogecoin as the crypto for the people, or ‘the people’s coin’.

Perhaps in a similar alignment to its positioning, Dogecoin has had a focus on "tipping" for online content and charitable giving.

In 2014 the Dogecoin community raised 26.5 million Dogecoin (worth around USD $30,000.00 at the time) to send the Jamaican bobsled team to the Sochi Winter Olympics.

In March of the same year, over 40 million Dogecoin was also raised (worth around USD $30,000.00 at the time) to help with the effort of building clean-water wells in Kenya.

Recent developments of Dogecoin

While Dogecoin’s utility has been positioned as being money/currency for tipping and charity, it is undoubted that its recent popularity is boosted by popular internet culture and celebrities.

In more recent years, celebrity ‘influencers’ (most notably Elon Musk, Mark Cuban) have also been publicly showing their support for Dogecoin.

With Elon Musk’s recent acquisition of Twitter, along with Twitter being a hotbed for crypto conversations, there have also been rumours of Dogecoin being integrated in the social media platform.

Aside from these rumours, Dogecoin has the undisputed leading role among memecoins that has stood the test of time. It has survived across the crypto bull and bear cycles in 2017, and now in 2021/2022.

Earlier this year, a team also created Dogechain, a layer built on top of Dogecoin. The aim of Dogechain is to bring crypto applications like NFTs, games, and DeFi to the Dogecoin community.

It also allows more utility to be given to Doge, as users can use Dogecoin to pay for gas fees on chain, mint NFTs, use in DeFi Dapps and more.

For investors astute in tokenomics however, it is worthy to point out that Dogecoin supply has no fixed limit currently. This was a deliberate tokenomics decision in order to keep the price of each individual token low and accessible.

While past results are not a direct indicator for future performance, the strong cult-ish Dogecoin community coupled with its typical overperformance in bull markets makes Doge a coin for investors to keep an eye on.

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