What is dogecoin?

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Definition:

Dogecoin is a digital currency created in 2013 to make cryptocurrencies more fun for mainstream users. It features a Shiba Inu dog associated with the meme “Doge.”

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Understanding Dogecoin

Society is still learning the importance of cryptocurrency as an alternative financial tool. Bitcoin — the first prominent cryptocurrency — attracted a small, dedicated group of followers after its creation in 2009. But cryptocurrency wasn’t on the radar of mainstream investors until a few years later.

Before cryptocurrency became more popular with mainstream users, dogecoin’s creators tried in 2013 to make digital currency more fun for the average person by making a playful alternative.

Example

Dogecoin is one example of an alternative cryptocurrency, or “altcoin.” Altcoins are digital currencies inspired by or that draw from Bitcoin’s code.

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What is dogecoin?

Dogecoin reflects the creativity of the crypto community. While dogecoin was initially created as a joke — it was meant to parody the explosion of ‘altcoins’ — the meme-inspired currency has become an accessible way for people to learn about crypto for the first time. For most of its history, dogecoin has been significantly cheaper than bitcoin.

Dogecoin was created by two software engineers, Jackson Palmer and Billy Markus, in 2013. Initially, it had a capped supply of 100 billion coins. The cap was removed in intervening years, apparently to allow for more consistent inflation.

As of February 2021 there are approximately 128 billion units in circulation. There is no cap on the supply of dogecoin. Roughly 10,000 new dogecoins are created every minute, as miners race to find the next block on the Dogecoin blockchain. Each person who mines a block receives a 10,000 coin “block reward.”

What gives dogecoin its value?

Dogecoin derives its value from the people who trade, hold, and transact in it. For example, some people use dogecoin and other cryptocurrencies to “tip” on the internet, sending small amounts of the digital assets to others as a gesture of appreciation. Like with all assets, the value of dogecoin may rise or fall depending on market conditions.

As of February 2021, neither bitcoin nor dogecoin is legal tender, though some companies are experimenting with accepting both currencies as payment for goods and services. As long as people mutually recognize their value, they might be used for transactions or held as a store of value.

How do you pronounce dogecoin?

The first syllable of dogecoin — doge — is pronounced “DOHJ.” When you say the word, think of it as doge-coin. It is named after a popular meme featuring a Shiba Inu. The dog in the meme received its nickname, “Doge,” from a Reddit commenter.

Disclosures

Cryptocurrency trading offered through Robinhood Crypto, LLC. Robinhood Crypto is licensed to engage in virtual currency business activity by the New York State Department of Financial Services and is not a member of FINRA or SIPC. Cryptocurrencies are not stocks and your cryptocurrency investments are not product insured by either FDIC or SIPC.

Ready to start investing?
Sign up for Robinhood and get your first stock on us.Certain limitations apply

The free stock offer is available to new users only, subject to the terms and conditions at rbnhd.co/freestock. Free stock chosen randomly from the program’s inventory. Securities trading is offered through Robinhood Financial LLC.

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