What is Dogecoin?
Dogecoin is a cryptocurrency that was invented by software engineers Billy Markus and Jackson Palmer, who decided to create "a payment system that is instant, fun, and free from traditional banking fees".
Dogecoin features the face of the Shiba Inu dog from the "Doge" meme as its logo and namesake. Even though Dogecoin was supposed to be a meme, the recent surge in the value of the meme cryptocurrency is alarming.
According to cryptocurrency data site CoinGecko, Dogecoin was trading at around $0.39, after hitting a record $0.43 earlier in the day. Its market value is more than $47 billion at present.
Unlike Bitcoin, the most popular and value surging Cryptocurrency in the market, the meme currency does not have any maximum limit of coins which is the reason why there are about 100 million dogecoins in existence, whereas Bitcoin, a pioneer of cryptocurrencies, has only 21 million tokens in existence.
As you can see, these are huge numbers because this is a meme currency. Look at the height it has reached! Just from February to April the surge has been higher.
How did the sudden rise take place?
The completely unpredicted rise of Dogecoin in recent weeks thanks to high-profile support by people like Elon Musk, CEO of Tesla Motors and Kiss's, a rock band, frontman Gene Simmons.
Apart from that, the meme based cryptocurrency also has an active, devoted community on various social media like Twitter and Reddit which introduces the potential for large scale investments by several investors around the globe (Sorry, flat earthers).
Several observers and enthusiasts have even compared Dogecoin, a meme cryptocurrency, to GameStop, which is the retail stock of the electronic retail company named the same, that WallStreetBets, a popular subreddit where participants discuss stock and option trading, took it from around $20 to a whopping $480.
However, Dogecoin still has a long way to go as to compete with the big shots like Bitcoin, whose market cap is 1.15 trillion USD and net worth around a 60,000 USD.
Should you invest in Dogecoin?
It is currently worth 40 cents or somewhere around there, so there isn't much of an investing here. It is predicted by experts that by the end of this year, 2021, Dogecoin would reach 1 USD. It is certainly impractical to invest in a meme currency like this, where the developers themselves didn't take it seriously.
Sure, that the value of Dogecoin has surged 18,000% but that's just it. Dogecoins can be produced more, upto infinity. In economics and related studies, the price of an asset will go down if its supply or production is up (From USA Times: Is Dogecoin better than Bitcoin? Careful not to invest everything into the lottery).
In layman terms, The more scarce a product or an asset is, the more value it holds.
But this ain't the case in Bitcoin, where only 21 million tokens are in existence, and no more can be produced, similar to that of rare metals like Gold and Platinum.
For every phenomenon, every process, there's always an exception. Same is in the case of Dogecoin. There are many people who've become rich by Dogecoin investment, but that's just a game of luck. It is uncertain that you can become rich by investing in Dogecoin.
This is just an informative article that was written after long hours of research in internet. Do not consider this for any real investment advice, this is just for educational purposes.
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