Dogecoin is a peer-to-peer, open, and public cryptocurrency that allows users to conduct digital transactions using a decentralized network. However, Dogecoin is truly unique because it’s the OG meme coin named after the Shiba Inu “doge” meme.
So what is it about this project that has roped in the likes of Elon Musk, Mark Cuban, and Snoop Dogg? Let’s take a look.
Who made Dogecoin?
IBM engineer Billy Marcus and Adobe engineer Jackson Palmer created Dogecoin on 6th December 2013. The idea was to spoof leading cryptocurrencies like Bitcoin. However, unlike Bitcoin, Dogecoin doesn’t have a limited upper cap and has an infinite supply.
The Dogecoin Foundation currently looks after the project. The Foundation is presently looking for 3 years’ worth of funding to hire a team and look after Dogecoin full-time. Ethereum co-founder Vitalik Buterin recently joined the Foundation as an advisor. In fact, Tesla founder Elon Musk himself tweeted that he has been working with dogecoin developers to improve “system transaction efficiency.”
Dogecoin Popularity and Elon Musk
The chart below shows you the “social volume” of Dogecoin. Social volume is a metric used to measure the number of mentions across social media platforms.
See those spikes starting in January 2021? That perfectly sums up the Dogecoin phenomenon. Around 2021, the sheer amount of mainstream exposure that Dogecoin got was beyond belief.
The following is a Google trends chart that compares Dogecoin (blue) and Ethereum (red).
As you can see, in 2021, Dogecoin has managed far larger spikes than Ethereum. Given that ETH is the second-largest coin by market cap, it is a pretty impressive achievement.
Of course, this surge in popularity would have been impossible to achieve without the involvement of a certain someone. Alright, let’s address the elephant in the room.
Elon Musk <3 Dogecoin
Tesla and SpaceX CEO Elon Musk has been tweeting about dogecoin forever. At one point, in 2021, DOGE was repeatedly charting new all-time highs thanks to Musk making some obscure references to the coin via his Twitter.
In fact, the Tesla technoking even went to SNL to talk about the coin!
Musk’s status with the Dogecoin crowd is akin to that of a cult leader. However, he is far from the only celebrity endorsing DOGE. Shark Tank host and Dallas Mavericks owner Mark Cuban, rapper Snoop Dogg, and Kiss bassist Gene Simmons have all jumped ship and actively promoted dogecoin.
Doge’s popularity has also been singularly responsible for the rise of multiple dog meme coins like Shiba Inu, Akita Inu, Floki Inu, etc.
Ok, But How Does Dogecoin Get Value?
Let’s be real here. There are very few use cases for DOGE, as of right now. Unlike Ethereum, it is not programmable, so you can’t make applications on top of it. At the same time, DOGE isn’t really a good store-of-value like Bitcoin. On the contrary, dogecoin is infamous for being volatile.
So, all things considered, what is the importance of DOGE? Where does it get its value? Well, let’s look at some angles.
The Perfect Gateway Crypto
Here is an interesting insight taken from a report by Crypto.com. The global crypto population doubled from 100 million to 200 million in just four months between January and May. While one of the significant aspects behind this rise was the spike in Bitcoin price, they identified another critical factor: the popularity of meme coins like Dogecoin.
This is a major use case. People from all over the world have dabbled in DOGE after seen their favorite celebrity endorsing the coin on social media. In essence, this makes dogecoin the perfect gateway to crypto.
There is another angle to this topic that we must talk about. Earlier in June 2021, the original Doge meme was sold for $4 million as an NFT. This NFT has since been fractionalized so that normal, everyday users can own a fraction of the meme for just $1. In essence, the dogecoin mania has indirectly encouraged people to participate in the NFT ecosystem as well.
The GameStop Factor
GameStop shares skyrocketed in January 2021. The shares were priced at $17.25 at the beginning of the year before ballooning to $500. These pumps were orchestrated by the popular Reddit forum WallStreetBets. Their purpose was to punish the hedge funds that had taken an outsized short bet against GameStop. As a result, these short sellers lost ~$2 billion in just two days.
This idea of “sticking it to the big guys” is also prevalent in the Dogecoin community. The CEO of deVere Group, Nigel Green, has outright said that Dogecoin is the new Gamestop.
Avi Felman, Head of Trading at BlockTower Capital. said:
“Dogecoin is like this kind of big F-U to the system. It’s like, ‘Yeah, this thing can have value, too. And I’m just going to buy it, because I’m going to buy it.’”
Dogecoin is one of the most interesting projects and a fascinating study as to how people come together and back a protocol to make it important and relevant. Let’s face it, Dogecoin may be a joke, but it’s a $32 billion dollar joke, as of writing.
However, there is something else that is truly fascinating about DOGE. Everyone knows that it has no utility, and it is “hustle” at the end of the day. However, it is the people’s hustle. The people decide what the price will be, and the people are solely responsible for its overall perception. There is something extraordinary about how a mere meme somehow got people from all around the world to root for it so passionately.