Dogecoin is the latest cryptocurrency in town and the newest internet sensation. Even bitcoin is struggling to meet up with the celebrity status of Dogecoin despite its trillion-dollar valuation. The popularity of the coin is hinged on Elon Musk who has sort of taken it upon himself to promote the coin.
How Dogecoin Started
Dogecoin started in 2013 as a meme between two engineers. IBM software engineer Billy Markus and Adobe software engineer Jackson Palmer had never even met when they combine Bitcoin, and “doge.” The result: Dogecoin. It now has a market capitalization of about $92 billion following a six-month climb of more than 26,000 percent.
5 reasons to buy
Mining of the coin is environmentally friendly
The crypto can not be mined alone. And it is now connected to the production of Litecoin Blocks. Due to this, it does not need any extra machinery to mine.
It has a good growth trajectory
The crypto has a good growth trajectory. It is predicted that in the near future, dogecoin will be equal to $1. So if you are looking to invest in it you should invest before its exchange rate is less than $1. As of now, one Dogecoin is valued at $0.059936. And, one Dogecoin is equal to 0.00000153 BTC.
Affordable to Buy
If you buy it now you can get more Dogecoin in one dollar, and you will get more than you are investing right now.
Price not driven by media hype
The price of Dogecoin is not driven by media hype but it’s controlled by its scarcity. And, as of now, its circulation is very high close to 128 Billion.
Simple to Use
The coin is simple to use. It is easily available through micro-wallets. So, it can be managed by a person who has just started mining it.
4 Reasons Not to Buy
Extremely limited utility
One disadvantage of Dogecoin, and crypto in general, is that there’s virtually no real-world use for these tokens. According to the online business directory Cryptwerk, around 1,300 businesses now accept payment or tips in Dogecoin. Compare this to Bitcoin that has more worldwide acceptance.
Unlimited supply
Miners can mine Dogecoin by themselves, or as part of a mining pool. Since there is an unlimited supply of coin tokens, the value of a single token is very low compared to others. Coins that have a limited supply are like a huge pie, you can buy some and take a piece of that pie and if you don’t sell, your piece stays the same. With coins that have an unlimited supply, your piece will always be shrinking unless you are constantly buying more. Currently, there are 18.6 million BTC in circulation, or 88.57% of the predetermined maximum of 21 million.
No tangible drivers
Dogecoin lacks real drivers. In the case of Bitcoin, it has a lot of institutional backers and it has been adopted by many organisations. For example, Tesla Motors buying $1.5 billion in Bitcoin and announcing it would accept payment in Bitcoin stands out as a real-world catalyst. Comparatively, Dogecoin has no real-world catalysts. Its ascent has been driven by social media hype, with none other than Tesla CEO Elon Musk behind most of the pumping. Since the vast majority of Dogecoin is owned by retail investors and not institutions, emotions have also played a key role. The thing about emotions is that they’re short-term in nature and can shift at any moment.
Its fees aren’t close to the lowest
Dogecoin transaction fees are lower than Bitcoin and Ethereum, but the fact is that other coins, such as Stellar, Nano, Ripple, Litecoin, and Dash all process transactions on their networks for much less than what you’d be charged via Dogecoin.
Damilola Faustino can be reached at damilola.faustino@gmail.com
