What Is Dogecoin (DOGE)?

14 Aug 2019

Launched in December 2013 as a “joke currency”, Dogecoin (DOGE) became increasingly popular among members of the crypto community and managed to reach a market capitalization of around $60 million in January 2014.

Initially developed by Billy Markus and Jackson Palmer, a product developer at Adobe, the cryptocurrency uses the “Doge” meme as its logo (featuring the Shiba Inu dog). In 2015, the circulating supply of Dogecoin was around 100 billion, and approximately 5.256 billion new coins have been created every year.

Binance Now Lists Dogecoin

Although there are not many practical use cases for Dogecoin, it currently has a market cap of around  $344.89 mn. Social media users have been sending tips to each other in Dogecoin and Binance, the world’s largest exchange in terms of trading volume, announced it will list DOGE.

On May 1, 2019, San Francisco-based crypto exchange, Coinbase revealed that “Coinbase Wallet”, a non-custodial wallet app for Android and iOS, would support Dogecoin transactions. 

Reasons for Creating Dogecoin

According to Markus, an experienced software engineer, he developed Dogecoin to spread more awareness about cryptocurrencies and potentially reach a wider demographic than Bitcoin (BTC), the world’s first and most dominant cryptocurrency.

Markus, a resident of Portland, Oregon, also noted (in December 2013) that Dogecoin was created in order to have “fun” and get away from the controversial issues associated with other altcoins. Meanwhile, Palmer, who works for Adobe Systems’ marketing department, said he was motivated to create Dogecoin after being encouraged to move forward with the project on social media.

Dogecoin.com Website Launched, Markus Begins Writing Code

Palmer acquired the Dogecoin.com domain name and added a basic splash screen to the website - which displayed the “Doge” logo. Shortly after the website was launched, Markus began writing code for Dogecoin, which was initially based on Luckycoin, an inactive cryptocurrency that used to distribute “randomized” rewards for mining blocks of transactions. 

In March 2014, Dogecoin’s mining rewards became static - meaning that miners were compensated for generating new blocks based on a more precise algorithm for calculating rewards.

Dogecoin Has 1 Minute Block Times

The Dogecoin blockchain uses scrypt technology and the proof-of-work (PoW) consensus algorithm to validate transactions on its network. Initially, there were only supposed to 100 billion DOGE coins, however the limit was later removed and now an infinite number of new coins may created.

The Dogecoin network has block times of around 1 minute, which may allow for transaction processing times when compared to Litecoin (LTC) and Bitcoin (BTC) that have block times of 2.5 minutes and 10 minutes, respectively.

Millions of DOGE Coins Stolen By Hackers

On December 25, 2013, millions of DOGE coins were stolen after hackers managed to gain access to Dogewallet, a cryptocurrency wallet platform developed for Dogecoin users. The crypto wallet platform’s filesystem was compromised by a hacker who changed the send and receive page for DOGE coins to “send any and all types” of coins to a single static address. 

To help the victims of the hacking incident, Dogecoin’s community members began an initiative called “SaveDogemas.” Several DOGE holders donated their coins to people whose funds had been stolen during the hack.

Palmer Takes “Extended Leave of Absence” from Crypto Industry

In April 2015, Palmer announced that he would be taking “an extended leave of absence” from the crypto industry. The senior manager at Adobe claimed that the crypto community had become “toxic”, however he told Dogecoin supporters to stay positive and to continue having fun with the lighthearted project. 

Elon Musk, the billionaire founder of SpaceX and Tesla, tweeted in April 2019 that Dogecoin “might be” his favorite cryptocurrency. He also mentioned that it was “pretty cool.” Musk’s comments came in response to a post from Dogecoin’s official Twitter account, which suggested (as an April Fool’s Day joke) that the cryptocurrency needed a CEO to manage its operations. 

“The Internet Currency”

According to its official website, Dogecoin is a decentralized digital currency that lets users easily conduct monetary transactions. Referred to as “the internet currency”, Dogecoin wallets are available for Windows, Linux, Android, and OS X users.

As an open-source cryptocurrency protocol, Dogecoin’s source code has been uploaded to its Github page, which states that the blockchain-based asset has taken “development cues” from Tenebrix and Litecoin.

The “Fun and Friendly” Crypto

As mentioned on its website, “Doge” is the Dogecoin’s “fun and friendly mascot” and Shiba Inu is a Japanese breed of hunting dog that became a popular online meme, and is now used to represent the Dogecoin project.

To join Dogecoin’s friendly and “vibrant” online community, the crypto’s supporters have created a Reddit group and an IRC Chat channel.

Dogecoin Core 1.14 Upgrade Released

In late June 2019, the cryptocurrency’s latest version, called Dogecoin Core 1.14 was released. As part of the update process, DOGE holders were told to make a backup of their wallet.dat files. 

Although the latest Dogecoin software has “successfully upgraded” existing wallets in the testing phase, it’s recommended that DOGE holders keep a backup of their files. 

Updated Source Code Contains Soft Fork to Enable BIP-65

The updated binaries may be downloaded from Dogecoin.com or the crypto’s Github repositories. As detailed in its release notes, Dogecoin Core 1.14 contains a soft fork (backwards compatible update) that enables bitcoin improvement proposal #65, or BIP-65.

According to its specification document, BIP-65 specifies a new opcode (OP_CHECKLOCKTIMEVERIFY) for Bitcoin’s scripting system that “allows a transaction output to be made unspendable until some point in the future.”

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