Dogecoin (/ˈdoʊ(d)ʒkɔɪn/ DOHJ-koyn or DOHZH-koyn, Abbreviation: DOGE; sign: Ð) is a cryptocurrency created by software engineers Billy Markus and Jackson Palmer, who decided to create a payment system as a "joke", making fun of the wild speculation in cryptocurrencies at the time. It is considered both the first "meme coin", and, more specifically, the first "dog coin". Despite its satirical nature, some consider it a legitimate investment prospect. Dogecoin features the face of the Shiba Inu dog from the "doge" meme as its logo and namesake. It was introduced on December 6, 2013, and quickly developed its own online community, reaching a market capitalization of over $85 billion on May 5, 2021. It is the current shirt sponsor of Watford Football Club.
Originally formed as a "joke", Dogecoin was created by IBM software engineer Billy Markus and Adobe software engineer Jackson Palmer. They wanted to create a peer-to-peer digital currency that could reach a broader demographic than Bitcoin. In addition, they wanted to distance it from the controversial history of other coins. Dogecoin was officially launched on December 6, 2013, and within the first 30 days, there were over a million visitors to Dogecoin.com.
On December 19, 2013, Dogecoin jumped nearly 300% in value in 72 hours, rising from US$0.00026 to US$0.00095, with a volume of billions of Dogecoins per day. This growth occurred during a time when bitcoin and many other cryptocurrencies were reeling from China's decision to forbid Chinese banks from investing into the bitcoin economy. Three days later, Dogecoin experienced its first major crash by dropping by 80% due to this event and to large mining pools exploiting the small amount of computing power required at the time to mine Dogecoin.
On December 25, 2013, the first major theft of Dogecoin occurred when millions of coins were stolen during a hack on the online cryptocurrency wallet platform Dogewallet. The hacker gained access to the platform's filesystem and modified its send/receive page to send any and all coins to a static address. This hacking incident spiked tweets about Dogecoin, making it the most mentioned altcoin on Twitter at the time, although it was in reference to a negative event. To help those who lost funds on Dogewallet after its breach, the Dogecoin community started an initiative named "SaveDogemas" to help donate coins to those who had them stolen. Approximately one month later, enough money was donated to cover all of the coins that were stolen.
On March 2, 2021, NASCAR Xfinity Series team B. J. McLeod Motorsports announced that Dogecoin would be sponsoring the № 99 car in the Alsco Uniforms 300 at Las Vegas alongside Springrates; Stefan Parsons drove the car to a 36th-place finish as fuel line issues prevented him from completing the race. Coincidentally, his father Phil was the owner of the team that fielded the original Dogecoin-sponsored car in 2014.
In January 2014, the trading volume of Dogecoin briefly surpassed that of Bitcoin and all other cryptocurrencies combined. However, its market capitalization remained substantially behind that of Bitcoin. Initially, Dogecoin featured a randomized reward that is received for each mining block. However, in March 2014, this behaviour was later updated to a static block reward.
The Dogecoin community and foundation have encouraged fundraising for charities and other notable causes. On January 19, 2014, a fundraiser was established by the Dogecoin community to raise US$50,000 for the Jamaican Bobsled Team, which had qualified for, but could not afford to go to, the Sochi Winter Olympics. By the second day, US$36,000 worth of Dogecoin was donated and the Dogecoin to bitcoin exchange rate rose by 50%. The Dogecoin community also raised funds for a second Sochi athlete, Shiva Keshavan.
Dogecoin started with a supply limit of Ð100 billion, which would have been far more coins than the top digital currencies were then allowing. By mid-2015, the 100 billionth Dogecoin had been mined, with an additional Ð5 billion put into circulation every year thereafter. Although there is no theoretical supply limit, at this rate, the number of Dogecoins put into circulation will only double in 20 years (the next doubling will occur in the year 2075). There is no implemented hard cap on the total supply of Dogecoins. Nonetheless, in February 2014, Dogecoin founder Jackson Palmer announced that the limit would be removed in an effort to create a consistent reduction of its inflation rate over time. In other words, the inflation rate improves over time starting at 5% in 2015 to less than 4% by 2019, 3% by 2027, and 2% by 2035.
On March 25, 2014, the Dogecoin community successfully raised Ð67.8 million (around US$55,000 at the time) in an effort to sponsor NASCAR Sprint Cup Series driver Josh Wise. Nicknamed the "Moonrocket", the No. 98 car featured a Dogecoin/Reddit-sponsored paint scheme and was driven by Wise at the Aaron's 499 at Talladega Superspeedway. Wise and the car were featured for nearly a minute, during which the race commentators discussed Dogecoin and the crowdfunding effort, while finishing twentieth and narrowly avoiding multiple wrecks.
Co-founder Jackson Palmer left the cryptocurrency community in 2015 and has no plans to return, having come to the belief that cryptocurrency, originally conceived as a libertarian alternative to money, is fundamentally exploitative and built to enrich its top proponents. His co-founder, Billy Markus, agreed that Palmer's position was generally valid.
Dogetipbot was a cryptocurrency transaction service used on popular sites like Reddit and Twitch. It allowed users to send Dogecoins to other users through commands via Reddit comments. In May 2017, Dogetipbot was discontinued and taken offline after its creator declared bankruptcy; this left many Dogetipbot users losing their coins stored in the Dogetipbot system.
During 2017 to early 2018 cryptocurrency bubble, Dogecoin briefly reached a peak of US$0.017/Ð1 on January 7, 2018, putting its total market capitalization near US$2 billion.
In July 2020, the price of Dogecoin spiked following a TikTok trend aimed at getting Dogecoin to US$1.
Musk's first Dogecoin-related tweet occurred on December 20, 2020. Musk tweeted 'One Word: Doge'. Shortly after, the value of Dogecoin rose by 20%.
Inspired by the Winter Olympics fundraiser and smaller charity fundraising successes, the Dogecoin Foundation, led by Eric Nakagawa, began collecting donations to build a well in the Tana river basin in Kenya in cooperation with Charity: Water. They set out to raise a total of Ð40,000,000 (US$30,000 at the time) Dogecoin before World Water Day (March 22). The campaign succeeded, collecting donations from more than 4,000 donors, including one anonymous benefactor who donated Ð14,000,000 (approx. US$11,000 at the time, or US$2.8m in 2021).
In January 2021, Dogecoin went up over 800% in 24 hours, attaining a price of US$0.07, as a result of attention from Reddit users, partially encouraged by Elon Musk and the GameStop short squeeze. In February 2021, Dogecoin hit a new high price of US$0.08 following Twitter encouragement from Musk, Snoop Dogg and Gene Simmons. In March 2021, Dallas Mavericks owner Mark Cuban announced his NBA team would allow purchasing tickets and products with Dogecoin; within two days, Cuban had declared his franchise had become the top Dogecoin merchant, having carried out 20,000 transactions.
This was followed by a series of Dogecoin-related tweets by Musk in early February 2021 captioned 'Dogecoin is the people's crypto' and 'no highs, no lows, only Doge'. Following these tweets, the value of Dogecoin rose by roughly 40%.
In April 2021, Dogecoin and other cryptocurrencies surged, stimulated in part by the direct listing for cryptocurrency exchange Coinbase on April 14, although that platform did not provide trading of Dogecoin. Its price first reached US$0.10 on April 14, before hitting a new high of US$0.45 on April 16 (up 400% that week ), with a volume of nearly US$70 billion traded in the preceding 24 hours. At the time , Dogecoin's market capitalization approached US$50 billion, making it the fifth-highest-valued cryptocurrency; its value had increased more than 7,000% year-to-date. Interest in Dogecoin contributed to an outage in electronic trading platform Robinhood's cryptocurrency system on April 15, caused by "unprecedented demand", and prompted concerns from experts of a nearing speculative bubble in the cryptocurrency market.
On April 15, 2021, the price of Dogecoin rose by more than 100% after Musk tweeted an image of Joan Miró's 'Dog Barking at the Moon' painting captioned 'Doge Barking at the Moon'.
In May 2021, the price of Dogecoin was up 10% in the hours after Musk tweeted a Reddit link for users to submit proposals to improve the cryptocurrency.
On May 4, 2021, the value of Dogecoin first surpassed the symbolic hurdle of US$0.50, a greater than 20,000% increase in one year.
On May 8, 2021, Dogecoin fell as much as 29.5%, dropping to US$0.49 during Elon Musk’s Saturday Night Live appearance.
On May 8, 2021, despite—or perhaps because of—expectations of a surge in interest in Dogecoin resulting from Elon Musk's appearance on Saturday Night Live, Dogecoin dropped 34% from US$0.711 at the opening of the show to below US$0.470 45 minutes later. By the following morning Dogecoin hit a swing low of US$0.401, a cumulative drop of 43.6% and lost value of US$35 billion.
On May 9, 2021, SpaceX announced a rideshare mission to the Moon completely funded by Dogecoin, thus becoming the first space mission funded by a cryptocurrency. Elon Musk confirmed this news via Twitter. DOGE-1 will be a minor 40 kg rideshare payload on Intuitive Machines' IM-1 mission in Q1 2022.
The price of Dogecoin rose by 11% on May 20, 2021, shortly after Musk tweeted a Doge-related meme.
On August 14, 2021, the Dogecoin Foundation announced the "re-establishment of the Dogecoin Foundation (est 2014), with a renewed focus on supporting the Dogecoin Ecosystem, Community and promoting the future of the Dogecoin Blockchain." The Foundation was reinvigorated by the addition to its Board of notable advisors such as Vitalik Buterin (Ethereum co-founder and inventor) and Jared Birchall (representing Elon Musk).
While the price of Dogecoin is volatile, this volatility has its benefits. It allows cryptocurrency day-traders, those being traders who enter and exit a trade within one day, to trade off this volatility and benefit from the extreme swings in Dogecoin's value. Additionally, while the cryptocurrency may have begun as a "joke", it was the 10th-largest cryptocurrency in the world in September 2021, with a market capitalisation of US$26 billion. Larger coins included Bitcoin, Ethereum, Cardano, Binance Coin, Tether, and XRP. Dogecoin uses relatively little energy for transactions compared with some other cryptocurrencies (0.12 kilowatt-hours per transaction (kWh)). In comparison, Bitcoin uses 707.6 kWh and Ethereum uses 62.56 kWh. Mark Cuban has stated of Dogecoin that, "Doge has 'deterministic inflation' meaning the amount of inflation is defined. There is no uncertainty as to the amount of created and it's inflation percentage. Which could allow it to grow as a valid payment mechanism. The unknown is whether enough people will use it this way."
On December 14, 2021, Dogecoin spiked more than 20% after Elon Musk said that Tesla will accept the currency as a means of payment for Tesla merchandise.
On June 16, 2022, Elon Musk was named in a complaint seeking damages of $258 billion. The complaint was filed in federal court in Manhattan by plaintiff Keith Johnson. Johnson cited Musk's repeated use of his massive social influence to promote the altcoin, which he claims artificially inflated the price.
As of July 2022, DOGE has fallen below US$0.07, and its US$8.9 billion market cap makes it the tenth-largest cryptocoin.