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If you’re looking for currency options, you should definitely consider looking into dogecoin. Dogecoin is a cryptocurrency, similar to litecoin or bitcoin. However, dogecoin is also very different from those kinds of popular cryptos.
Dogecoin was originally started as a joke in order to poke fun at bitcoin. The coin got its name from a popular meme featuring a Shiba Inu. However, these days, dogecoin is no laughing matter.
In fact, many people have gotten rich from a coin that was worth fractions of a penny just a few years ago. A lot of people who bought dogecoins as a joke suddenly found themselves a whole lot wealthier.
Despite the unusual story behind dogecoin, its price has surged significantly in recent months. This is thanks to a lot of speculation and people’s newfound interest in cryptocurrencies during the coronavirus pandemic.
Are you wondering how you can invest in dogecoin and get in on the action? If so, then keep on reading and we will walk you through everything that you will want to know.
What Is Dogecoin?
Dogecoin was created in late 2013 by software engineers, Jackson Palmer and Billy Marcus. Palmer used a popular meme at the time to brand the currency. The mem featured a smiling Shiba Inu dog and the misspelled word “doge.”
Dogecoin was originally created as a joke. In its first days as a currency, a community of dogecoin fans arranged for publicity stunts in order to raise the coin’s profile. This included things like sponsoring NASCAR drivers and raising money to send the Jamaican Bobsleigh team to the 2014 Olympics.
Dogecoin was still fairly obscure up until the start of 2021. However, at the start of 2021, a lot of people starting talking about dogecoin on the infamous WallStreetBets subreddit. These were the individuals who were responsible for the GameStop stock debacle.
In 2021, dogecoin surged several thousand percent. The dogecoin price grew a lot thanks to Elon Musk, who was very vocal about his love for the coin on Twitter and television.
How Does Dogecoin Work?
Similar to litecoin and bitcoin, dogecoin is a digital currency that utilizes blockchain technology. Blockchain is a safe and distributed virtual ledger. It stores all transactions that are made and posts them publicly.
All users have an identical copy of the blockchain ledger for dogecoin. This is updated frequently with all new transactions. Similar to other cryptos, the blockchain network for dogecoin uses cryptography in order to keep all of the transaction safe.
The process of recording and validating transactions on the blockchain is performed by people known as miners. They use computers to figure out complicated math problems. This is known as a proof of work (PoW) system.
Of course, people don’t do all of this work just out of the goodness of their hearts. When you contribute to the blockchain, you are rewarded with dogecoins. You can then choose to sell or hold your coins on the open market.
You can use dogecoins to make purchases and payments However, dogecoin is not a great store of value. Most cryptocurrencies, like bitcoin and litecoin, set a cap for how many coins there can ever be in circulation.
This is not the case for dogecoins. Instead, there is no limit for how many dogecoins there can be in circulation. As people keep mining dogecoins, inflation can start to set in and lead to a devaluing of the currency.
Millions of new dogecoins are generated every day. This can make dogecoin a great speculative trade but not a very effective long-term investment.
How to Invest in Dogecoin
You can purchase dogecoin on a crypto exchange. Most exchanges will make you set up and fund your account with cryptocurrency or American dollars. You will then be able to purchase and exchange cryptocurrencies, including dogecoin.
It should be noted that Coinbase, the leading cryptocurrency exchange, does not support dogecoin.
You can also buy dogecoin from online brokers that also sell stocks and bonds. These services tend to come with high fees, however.
After you buy dogecoin, you want to move it to your digital wallet. You want to do this with any crypto that you might have. A wallet can take a lot of different forms. It can be an app on your phone, an external hard drive, or an online service.
When you hold your coins outside of an exchange, you will be able to achieve an added layer of protection against criminals.
Before dogecoin attained mainstream appeal and surged in price, people used to be able to earn free coins by performing basic tasks on the internet.
For a long time, you could complete tasks at Dogecoin ‘faucets.’ This allowed people to earn dogecoin instead of purchasing it. The tasks included things like taking a survey or watching an ad.
Over the past year, it has been harder to come across these services.
The Importance of Knowing About Currency Options like Dogecoin
Hopefully, after reading the above rticle, you now have a better idea of how currency options like dogecoin work. You should now also understand how to invest in dogecoin and how you can speculate on assets like this.
By knowing more about dogecoin and how it works, you can make more educated decisions when it comes to your investments.
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