Dogecoin is a cryptocurrency, like Bitcoin or Ethereum—although it’s a very different animal than either of these popular coins. Dogecoin was originally created at least in part as a lighthearted joke for crypto enthusiasts, and took its name from a once-popular meme. But dogecoin isn’t just a meme coin; it has actual utility. Dogecoin is used as a tipping currency on social media platforms like Reddit and Twitter, and is also accepted by some online retailers as a form of payment including potential SpaceX.
Dogecoin’s fast transaction times and low fees make it a good choice for microtransactions, like tipping someone for a helpful post or buying something small online. And because dogecoin is mined using a proof-of-work algorithm, anyone with a computer can help process transactions and earn doge
How Does Dogecoin Work?
Dogecoin is based on the Litecoin protocol, which means it uses proof-of-work consensus. That means dogecoin miners (people with special computers) verify dogecoin transactions and add them to the dogecoin blockchain—similar to how Bitcoin or Ethereum miners work. As an incentive to do this work, miners are rewarded with dogecoin. The dogecoin block time is one minute, which is faster than both Bitcoin and Ethereum. That means dogecoin transactions are confirmed more quickly, but it also means there’s a higher chance of orphaned blocks (blocks that aren’t added to the blockchain).
How are Dogecoin & Bitcoin different?
Dogecoin is different from Bitcoin in several key ways. First, dogecoin has a much faster block time, meaning transactions are confirmed and added to the dogecoin blockchain much more quickly than they are on the Bitcoin network. Dogecoin’s block time is only one minute, compared to Bitcoin’s ten minutes.
How do you buy Dogecoin?
You can buy Dogecoin through many exchanges including the most prominent ones, FTX, Coinbase and Binance. Buying Dogecoin is similar to that of other crypto currencies. You’ll need to set up an account on the exchange of your choice, deposit some fiat currency (like USD or EUR) and then you can start buying dogecoin.
As with other cryptocurrencies, once you’ve purchased Dogecoin it’s best to move your coins to a crypto wallet. Wallets take many forms, from online services offered by exchanges like Coinbase, to apps on your mobile device or even a physical hard drive. You secure the wallet with a private password. Since your coins are held outside of an exchange, there’s an extra layer of protection against hacks.
Should You Buy Dogecoin? What is Dogecoin’s future?
Dogecoin’s future is hard to predict. The dogecoin community is very active and vocal, and has been able to successfully rally around causes in the past. For example, dogecoin was used to raise funds for the Jamaican Bobsled team to go to the 2014 Olympics. As should go without saying this isn’t investment advice, like any other asset, especially crypto currencies which can be very volatile and risky assets, please make sure to do your de diligence thoroughly. As it stands Dogecoin is still down dramatically, more than 80% since its peak back in May 2021. It’s tough to say what will happen, after all memes are a powerful force on the internet with a large enough community and momentum, anything is possible.