Home Crypto News Dogecoin: From Reddit Meme to Elon Musk’s Obsession – the Evolution of DOGE

Dogecoin: From Reddit Meme to Elon Musk’s Obsession – the Evolution of DOGE

22 min read

Over the previous decade, the cryptocurrency sphere has risen from digital obscurity to monetary stardom. Just over 10 years in the past, Bitcoin was nothing greater than a challenge {that a} pseudonymous cryptographer had created and launched into the wild.

Because of crypto’s humble beginnings on cryptography internet boards, cryptocurrency nonetheless has heavy associations with meme tradition. One of the greatest examples of that is Dogecoin (DOGE), which has been round since 2013, however has solely not too long ago seize the consideration of the mainstream media.

Dogecoin was not too long ago thrust into the highlight when some of the similar r/WallStreetBets merchants that precipitated the GameStop rally turned their consideration to DOGE. Within days, the merchants pumped the worth of Dogecoin from $0.007 per token to $0.07 a pop, which is an increase of roughly 1000%.

Simultaneously, Tesla’s Elon Musk appeared to be growing a bit of a fascination with Dogecoin. A quantity of analysts consider that Musk’s tweets about the coin are an enormous half of its latest recognition and persistently increased worth level.

But what’s Dogecoin, actually? Where did it come from? And why is Elon Musk so obsessive about it?

Elon and DOGE: A Love Story

Elon Musk’s first public nod to Dogecoin got here in April 2019, when he tweeted that DOGE “might be my fav cryptocurrency. It’s pretty cool.”

However, Musk’s actual love affair with DogeCoin seems to have begun towards the finish of 2020 when he started tweeting and talking about Dogecoin pretty commonly. Then, after WSB merchants appeared to embrace Dogecoin as the goal of their efforts earlier this yr, Musk’s consideration on DOGE was renewed. .

Though it appeared that Musk’s fascination with Dogecoin began as a joke, the world took his phrases very critically: many of the tweets that Musk made about Dogecoin despatched the worth of DOGE skyrocketing.

For instance, on February 4th, 2021, Musk despatched a flurry of tweets about Dogecoin. Most of them appeared to be memes and jokes. However, the tweets despatched the worth of DOGE from $0.031 to $0.057 inside 24 hours.

“Dogecoin is the people’s crypto,” Musk wrote on February 4th. “no need to be a Gigachad to own…no highs, no lows, only Doge.” He posted a meme of himself as Rafiki from the Lion King holding a Doge-Simba up to the solar with the phrases “ur welcome;” he additionally wrote the phrase “Doge” alongside a picture of a rocket taking pictures for the moon.

The similar day, Binance Chief Executive, Changpeng Zhao referred to as Musk Dogecoin’s “cool, fun PR manager.”

Following in Musk’s Footsteps, Other Celebrities Paid Public Tribute to DOGE

Within the days that adopted Musk’s stream of DOGE-related tweets, a number of different celebrities jumped on the Dogecoin wagon. Snoop Dogg joined in the enjoyable on Saturday, February sixth, when he tweeted an altered image of one of his album covers with the phrases “Snoop Doge,” tagging Elon Musk.

KISS frontman, Gene Simmons, additionally tweeted on February sixth that “I bought even more Dogecoin. Why? Because I believe it will go up. But, that’s just me.” Simmons referred to himself as the “God of Dogecoin.”

Then, on March eighth, Mark Cuban bragged that his basketball membership, the Dallas Mavericks, was the largest Dogecoin service provider in the world.

It has been unclear precisely what Elon Musk is after together with his very public fixation on Dogecoin. Musk’s fascination with DOGE appears to have began as a joke. However, over time, some of the statements that he has made about Dogecoin seem to be pretty critical.

For instance, on February 15th, Musk tweeted that he was prepared to purchase out Dogecoin whales so as to make DOGE a less-centralized asset. Musk additionally not too long ago stated that he believes that Dogecoin needs to be listed on Coinbase.

Eventually, Musk’s fixation with Dogecoin appeared as if it could have landed him in sizzling water. Rumours that the SEC could be probing Musk over the tweets had been reported by newswire service, First Squawk, which cited sources acquainted with the matter in late February.

However, Musk appeared to take the rumours in stride. “I hope they do!” He tweeted, referring to the SEC. “It would be awesome!”

“Whether or Not This Is All One Big Joke Is a Tricky Question.”

Despite all of the hype (and the hassle), it’s nonetheless a bit unclear what Musk actually thinks about Dogecoin.

Shidan Gouran, Chief Executive of service provider banking advisory, Gulf Pearl.

Shidan Gouran, Chief Executive of Gulf Pearl, instructed Finance Magnates that: “the difference between Elon Musk and the vast majority of cryptocurrency experts out there is that Elon Musk has the most to lose in terms of reputation and credibility.”

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“He does not operate in the shadows or under a pseudonym, nor does he depend on crypto picks to make a living considering he is the head of the world’s most prolific firms with a market cap of over USD $800 billion,” Gouran added.

As such, “Hundreds of millions of people around the world treat him as a prophet of investing, and I believe it goes without saying that he would not stake that on something he was not serious about. While my reach or influence is nowhere near that of Elon Musk’s, I also have a reputation to uphold and can confidently provide a ‘conditionally’ positive rating of Dogecoin as a cryptocurrency.”

Still, “whether or not this is all one big joke is a tricky question,” Gouran acknowledged additional.

“Fundamentally, Dogecoin in and of itself is a joke. I call this class of cryptocurrencies Memecoins, which are essentially intended to be ‘just for fun’ and not treated as seriously as cryptos such as Bitcoin and Ethereum.”

“The analogy I would use is that they are like arcade tickets compared to real money. They have use in a specific context and with an implicit understanding that they’re not meant to be treated exactly like real money, but that doesn’t mean they can’t be treated that way when the stars line up.”

“The First Thing I Said Was, ‘This Is So Funny. Then I Said, ‘I Should Just Make This Coin.”

Yes, Dogecoin actually did begin as a joke.

According to Business Insider, Dogecoin was created as the consequence of an web friendship between IBM software program engineer, Billy Markus and Adobe software program engineer, Jackson Palmer. The two males had not even met in particular person after they efficiently married Bitcoin to the ‘Doge’ meme.

At the time, Mr Markus instructed Business Insider that he noticed a Tweet by Mr Palmer, who jokingly posted “Investing in Dogecoin, pretty sure it’s the next big thing.”

“The first thing I said was, ‘This is so funny’,” Mr Markus defined. “Then I said, ‘I should just make this coin’.” Markus then constructed the Dogecoin protocol based mostly on code from Litecoin and Luckycoin. Thus, Dogecoin was born.

Richard Gardner, Chief Executive of Modulus, instructed Finance Magnates that: “In about 2017, our company actually profiled more than 1,000 cryptocurrencies, including Dogecoin, and our evaluation was that it was a parody cryptocurrency designed to make light of some of the more ridiculous altcoins which were popping up around the time of time of its creation.”

Richard Gardner, Chief Executive of tech providers supplier agency, Modulus.

The Merits of DOGE

However, the undeniable fact that the cryptocurrency had so fully embraced the Doge meme didn’t imply that it lacked technical substance or professional use circumstances.

For “At the same time, the idea was to make a cryptocurrency that didn’t require a massive understanding of technology,” Mr Gardner continued. “It quickly gained a following as an easy, fun, novelty because of the community surrounding it. It has become popular as a method of rewarding content creators on Reddit and other social media sites.”

Indeed, Dogecoin’s recognition on Reddit was so explosive that inside a number of weeks of its creation, its market cap rose to $8 million. A yr later, Dogecoin’s market cap was approaching $20 million.

Even earlier than Elon Musk started his fascination with Dogecoin, the coin was persevering with to develop, and in some circumstances to get professional recognition. For instance, when Weiss debuted its Crypto Ratings chart in 2018, Dogecoin was given a “C”, which was the similar marking given to XRP. (Needless to say, XRP followers weren’t precisely thrilled.)

Additionally, Richard Gardner identified that Dogecoin had a historic second of its personal proper in August of 2018 when it Tweeted that “the system test of the Dogecoin-Ethereum bridge was completed and successful.”

Unfortunately, “Dogethereum” was a bridge too far. The thought behind the bridge that the replace supplied interoperability between the blockchains serving every cryptocurrency. Unfortunately, “the project suffered a lack of funding and the bridge was not completed at the time.”

“There Is Nothing Technologically Unique about DogeCoin.”

Of course, Dogecoin does have its points–particularly, there are a variety of technical shortcomings that might get in the manner of DOGE changing into “the people’s crypto.”

Gouran acknowledged that: “like most memecoins, there is nothing technologically unique about Dogecoin.”

“Cryptos such as Ethereum, Stellar and Ripple all have unique technological attributes which create some form of a value proposition.”

Why does this matter? Imagine two arcades: “if tickets to ‘Bob’s Arcade’ suddenly become valuable, and Bill decides to open his own arcade and buys his tickets from the same vendor, there is nothing inherently unique or valuable about them,” he stated. “But if everybody likes Bill better than Bob and they decide to go to Bill’s Arcade instead, that popularity can create value for tickets at Bill’s Arcade despite the fact that they both have the same tickets.”

“Remember that all blockchains use open-source software, which means there are no trade secrets or ‘secret sauce’ involved when it comes to the sophistication of the technology. If it’s out there, anybody can make derivative works of it.”

Dogecoin’s Centralization Problem

Beyond DOGE’s technical limitations, there’s additionally the problem of its centralization. Changpeng Zhao introduced this up on February 4th when he referred to Musk as Dogecoin’s PR supervisor.

“1 address holds 27% of all #DOGE,” CZ wrote. “Top 20 addresses holds more than 50%+ of all #DOGE. Kinda ‘centralized’ in that sense.”

Gouran additionally instructed Finance Magnates that: “when it comes to Dogecoin specifically, there is a high concentration of ownership in the total supply of tokens. Approximately 30% of the supply has been bought up by one entity over the past three years.”

“While this reflects a certain level of faith in the asset, it also reflects vulnerability to market manipulation, which is something to bear in mind,” he stated.

Elon Musk himself has tried to deal with Dogecoin’s centralization downside. On February 15th, Musk urged Dogecoin “whales” to promote their cash: “if major Dogecoin holders sell most of their coins, it will get my full support. Too much concentration is the only real issue imo.”

So far, it appears that evidently nobody has taken Musk up on the provide. Still, Dogecoin appears to be extra in style than ever. What is subsequent for Dogecoin? Let us know your ideas in the feedback under.


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