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What is Dogecoin, and how does it work? What happened when a joke became more popular than bitcoin?

What exactly is Dogecoin?

Dogecoin, like all cryptocurrencies, is a digital currency that can be purchased and sold like a stock and spent like cash.

While each cryptocurrency is distinct, it shares specific characteristics with its more well-known counterparts — for example, its code is based on the litecoin script. However, there are a few main differences.

Unlike bitcoin, which has a limited number of 21 million coins in circulation, dogecoin has 129 billion coins in circulation and will continue to release new blocks of coins each year. That’s why a dogecoin is currently worth about three dimes, and a bitcoin is currently worth about $62,000.

Dogecoin isn’t widely used in the real world, even though cryptos are becoming more widely accepted as a means of buying products. It has a few niche markets, such as tipping online artists with dogecoin.

And the odd-ball currency’s key differentiator — its engaging online community — is what makes it so entertaining. The Reddit-based organization has raised money for social causes (in dogecoin, of course), and in 2014 it successfully crowdfunded a sponsorship to get Nascar driver Josh Wise to advertise dogecoin on his car.

In a paper updated in February about the digital currency, Usman Chohan, an economist at the University of New South Wales Business School, wrote, “Dogecoin is not so much an alternative deflationary numismatic instrument as it is an inflationary leisured pursuit of community-building around a crypto asset.”

What do you think?

Written by Winston

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