Before you dismiss this article about a joke currency, the points I will be making about Dogecoin will be quite serious. So, if you are even marginally interested or seek to expand your horizons, follow along.
So what is Dogecoin? Well, it was created shortly after Bitcoin as a fun entry cryptocurrency without all the criminal ties that was the Silk Road in the past. It has a lively and friendly community who also use this currency for tipping and fundraising. Some notable fund raises are for the 2014 Jamaican Bobsled team and sponsoring a NASCAR driver Josh Wise.
So with such a positive community to be around and an easy going attitude, what could be the drawbacks? Well, the biggest problem to people trading or investing is that it will not increase in value and most likely never will. The biggest reason for this is because of the infinite circulation meaning they can be mined forever. While it won’t get any easier to do, the difficulty and energy costs are in itself a mechanism to curb inflation.
If there was one coin to get people introduced to cryptocurrencies, this is the coin to get them started. It’s incredibly affordable as is often given away in many faucets websites. The large and friendly community is also incredibly helpful. The near universal acceptance due to its history means it’s a mature and actively used coin that’s not an experiment or a fad. While many simply won’t hoard large amounts of this coin, it’s always good to have for small transactions or to tip people as a gesture to their contributions.
But what if you are not a newbie, and still can’t see what the big deal about Dogecoin is. The reason is that Bitcoin is the price ceiling, and then Dogecoin is in effect the price floor. Its low market value means smaller barrier of entry and exit, low transactional fees compared to larger coins and transactions that are actually faster than bitcoin. Some of the more advanced users prefer this as a way to divide larger coins and dodge those fees or exchange to as a “quick exit” for when their risky crypto investment goes awry.
By establishing these two extremes of value, most users however are somewhere in the middle. Right now, that middle is the most exciting or chaotic depending on where your cryptocurrency portfolio is positioned. When it does get too interesting, having options is always a good thing. Because when we know where the roof and floors are, we will certainly know where we want to go.