What is Dogecoin? 📝
It was founded by two engineers called Billy Markus and Jackson Palmer. Markus worked at IBM and Palmer at Adobe
So, Dogecoin was the self depricating example of a clone coin trying to be the "next Bitcoin" and on the 6th of December 2013, the first block was mined
Dogecoin is based off of a proof of work cryptocurrency called 'luckycoin'. This was actually a fork of Litecoin which is why Dogecoin can be merge mined with Litecoin
Block rewards could be anywhere from 1 DOGE per block all the way up to 1 million DOGE per block. I should also point out that there was no premine to Dogecoin
The developers then decided that they would remove the randomness component altogether and the block reward was fixed at 10,000 DOGE per block. Since a Dogecoin block is mined every minute, this meant a supply growth of 5.2 billion DOGE
When it comes to network effeciency, Dogecoin can handle around 30 transactions per second which implies a transaction time of about 5 to 10 minutes. The average transaction fee is about 1 cent
📈 Why Dogecoin Pumps 📈
- Meme Culture
- Social Media
- Elon Musk
- Robinhood
We live in an age of memes. It therefore makes sense that a Shiba inu meme like Dogecoin would take off so well. It's instantly relatable and easy to remember
As we know, social media is able to amplify memes and make them go viral. Memes feed on themselves and supercharge that engagement. This is especially the case with TikTok where it has been trending the most
You also have the impact of Elon Musk and all of his pro Dogecoin tweets. Elon has been riding the Dogecoin meme like nobody's business. Indeed, you can almost perfectly track the price pumps in Doge to his tweets about it
Then you have Robinhood which means that it is a lot easier for these newbies to invest in DOGE through a simple trading interface
🤔 Why They Invest 🤔
There are three types of Dogecoin investor. You have those that are investing purely because they are having fund and enjoy the memes. They know the risks and are more than happy to take part in the pumps / dumps.
Then you have those that are merely investing because they really think that it could be the next world currency. They follow every one of Elon's tweets and are not taking adequate risk management steps. These appear to be the most dominant
When these investors take out these risks they push up the price of DOGE and this creates a feedback loop. People think that the price performance is indicative of a valuable crypto.
Posted Using LeoFinance Beta