Dogecoin is not only a joke to poke fun at the cryptocurrency market. Currently, DOGE is a major altcoin with the 13th largest market cap.
This article takes an overview of Dogecoin, its core areas of business, and - most importantly for prospective investors - the pros and cons which can help answer the question: Should You Buy Dogecoin?
Dogecoin has been trending online for the past year. This is as a result of the enormous gains the cryptocurrency has brought investors who followed Elon Musk’s post as well as discussions on Reddit and Twitter.
The coin returned about 180% for investors in 2021. This is a staggering figure to analysts and experts who have followed the price performance of the cryptocurrency for years. It may come as a surprise to many sceptics of DOGE that before April 2021, the asset was worth a fraction of a penny.
Unlike Binance Coin (BNB), Cardano (ADA), Ether (ETH) and Tronix (TRX) which powers the networks of their respective blockchains, DOGE can only be used as a transactional currency.
Currently, several people use the cryptocurrency to tip people on social media. Dogecoin has also gained exposure as a humanitarian cryptocurrency that supports causes around the globe.
With a volatility rate that currently stands at 0.61, the meme coin has the potential to soar to new highs within a short period of time. But it can also bottom out in the near future if the hype surrounding the coin comes to an end.
With the potential to see the cryptocurrency rise substantially in a short period of time, is Dogecoin a good investment? As a cryptocurrency that can gain 400% in a single week, will DOGE continue to soar? With all the hype on Twitter and Reddit, can Dogecoin be like Bitcoin?
Most importantly, for novice traders and investors - what are the pros and cons which can help answer the question; should I buy Dogecoin?
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- Dogecoin at a Glance
- PROS of Buying Dogecoin
- CONS of Buying Dogecoin
- What Is The Safest Way To Buy Dogecoin?
- Dogecoin Price Prediction: What Are Analysts Saying About Dogecoin?
- The Bottom Line - Should You Buy Dogecoin?
Dogecoin At A Glance
This section gives an overview of Dogecoin, the beginnings of the crypto, its founders and why it was created. Additionally, an extensive look at the price performance of the cryptocurrency would be thoroughly analyzed.
Software developers Billy Markus and Jackson Palmer are widely credited as the creators of Dogecoin.
In 2013 Dogecoin was created to be a ‘fun crypto’, to laugh at the momentum cryptocurrencies were getting from the discussions of financial gurus about its penetration into a traditional market.
Jackson Palmer used Twitter to poke fun at his innovation, not knowing the huge buzz which would soon surround the cryptocurrency.
Eventually, Twitter users started asking questions about the digital coin. Palmer then purchased the domain (dogecoin.com) to give fans a landing page they can visit to get to know more about the cryptocurrency.
Upon seeing the buzz, a dream was resurrected within Billy Markus, who was working as a software developer at IBM at the time. After Markus’s previous attempts to create a cryptocurrency had proved futile and he came to love the idea of the meme-inspired crypto which was trending on social media.
Markus and Palmer decided to become partners and create a real coin. They named it Dogecoin and designed the coin in a way where it could reach a wider demographic.
Since BTC was out of reach for a lot of miners, creators decided to employ SCRYPT instead of Bitcoin’s SHA-256 algorithm. This allowed miners to use personal computers to facilitate the validation and verification of transactions.
On 6th December 2013, Dogecoin was launched after the domain (dogecoin.com) saw more than one million visitors.
What is Dogecoin?
On the cryptocurrency’s official website, Dogecoin is a decentralized, peer-to-peer cryptocurrency which enables you to easily send money online. Simplistically, it is internet currency.
The digital coin features the face of a breed of hunting dogs from Japan, called Shiba Inu.
Its ticker symbol is DOGE and Ð is its symbol.
Why Was It Created?
Dogecoin was created to help its users send money to anyone in the world over an internet network in a quick and secure manner.
The creators of the coin created Dogecoin to be more friendly and approachable and not as a competitor to Litecoin or Bitcoin.
Check Out: Bitcoin vs Dogecoin
How Many Dogecoins Are In Supply?
There are 132.67B DOGE in circulation which is the same as the total supply of coins on the market, at the time of writing.
DOGE Price Performance from 2014 till Date
Doge began trading on 1st January 2014 with an opening price of $0.0020. Since that day, traders and investors have had a difficult ride as to whether the cryptocurrency would ever be worth $1. Doge closed 2021 at a price of $0.0002.
The year 2015 saw Dogecoin maintain its price and nearly went into extinction zones. Doge opened and closed 1st January at a price of $0.0002. It ended the year with the same trading price it had on the first day. There was no change in price.
The year 2016 was the same as 2015. By the end of the year, DOGE was exchanging hands for $0.0002.
DOGE followed in the steps of Bitcoin and other altcoins and increased in price in 2017. Dogecoin opened and closed 1st January 2017 at a price of $0.0002 and ended 2017 with a trading price of $0.0087.
Doge strived hard to maintain its price during the bearish outlook of the cryptocurrency market in 2018. Dogecoin opened and closed at $0.0090 on 1st January 2018. By the end of 2018, DOGE was trading for a coin at $0.0024.
The year 2019 was tagged as a year of recovery for all digital assets but Dogecoin couldn’t survive the selling pressure. Having opened at $0.0024, DOGE was on its way to a price increase as it closed June at a price of $0.0032. Doge saw a huge sell-off by holders which saw it drop to $0.0021 to end the year.
The year 2020 was bittersweet for cryptocurrencies as it reached new high lows and new high highs. Dogecoin took advantage of the rally which happened in the second half of the year. DOGE had a trading price of $0.0021 by 1st January and traded for $0.0057 by the end of the year. In the process, DOGE returned 171.29%.
2021 was very different from previous years as cryptocurrencies such as Bitcoin, Ethereum, Binance Coin and tradable tokens such as yearn.finance reached new all-time highs. DOGE returned an impressive 180% for investors by the end of last year.
DOGE had 23,384 transactions count which is valued at $67.94M within the last 24 hours. HODLers who were patient enough to hold the cryptocurrency from its launch date to its current trading price would have made gains as it has returned 21,000%.
What are the pros and cons of investing in DOGE going forward? Will the cryptocurrency continue to bring gains to investors in the short and long term?
Pros Of Buying Dogecoin
Dogecoin’s rally has led to many discussions in financial news outlets as to whether the joke currency should be taken seriously. Most analysts have linked its sharp rise and fall to a form of ‘gambling investment’.
With that said, there are thousands of novice investors who want to try their hands at Dogecoin. What should such traders and investors know about DOGE before investing?
Where does this difference come from? What are the pros which can guide you to make an investment decision on the cryptocurrency.
✅ Dogecoin Is Less Susceptible To Hacking
Billy Markus and Jackson Palmer designed the protocol of Dogecoin based on existing cryptocurrencies Litecoin and Luckycoin. These cryptocurrencies employed the SCRYPT proof of work algorithm. This has made Dogecoin’s blockchain relatively faster than Bitcoin’s.
Opting for SCRYPT and not Bitcoin’s longstanding SHA-256 algorithm also meant that miners did not have to find specialized equipment for mining. Instead, miners can use normal Central Processing Units (CPU) and Graphic Processing Units (GPU).
With such technology in place, it makes it harder for an individual to have 51% of the computational power of the Dogecoin Network. Without more than 50% of power on a potential hacker’s side, it’s almost impossible for them to successfully alter the ledger.
This has so far prevented hacking on Dogecoin’s blockchain and has been invaluable in its run so far in the last 8 years.
✅ Dogecoin Scales Relatively Faster Than Most Cryptocurrencies
Dogecoin has an impressive average transaction time. DOGE confirms 1 block every minute. This gives the meme cryptocurrency an advantage over other cryptocurrencies in terms of processing transactions.
Litecoin’s average transaction time is 2 minutes 30 seconds. Ethereum has an average transaction time of 13.11 minutes while Bitcoin’s average transaction time is 13.95 minutes.
Fast transaction and confirmation speeds automatically result in lower transaction costs. DOGE has a 24-hour average transaction fee of $0.20 which is relatively better than Bitcoin and Ethereum at $1.6 and $11 respectively.
This is the primary reason why the cryptocurrency is often used as an option of payment in the poker, adult and real estate industries.
Its processing speed also played an equal role in DOGE being integrated as an option of payment for the Dallas Mavericks, COVCARE and other online retail stores. The more Dogecoin is adopted, the more likely usage of the coin will grow and this activity will likely result in the price appreciating.
✅ Increased Use Rates Due From Partnerships
Cryptocurrencies such as Dogecoin normally have a primary function of being used as a transactional currency on online stores. This makes partnerships an integral part of its survival.
With more such partnerships in the future, use rates would increase substantially and positively affect the valuation of the cryptocurrency.
CoinFlip is the largest network of Bitcoin ATMs in the United States. On 1st March 2021, it tweeted that “We’re excited to announce that we are listing #dogecoin on CoinFlip ATMs! You can now buy $DOGE with cash at any of our 1,800 locations nationwide!”
CoinDesk followed up via email to know more about this partnership. One of the representatives of CoinFlip pointed out that “CoinFlip has always been about the small business and retail customers, and with recent events, dogecoin has paradigm-shifted itself into more than just a meme coin, it has become a symbol of the small league investors”.
The partnership has so far affected the price patterns of the cryptocurrency. DOGE opened at $0.04807 and closed at $0.0506 on 1st March 2021.
On 16th April 2021, DOGE reached a new all-time high of $0.4377. The purchase of DOGE as well as its usage made possible by CoinFlip has seen a price increase of 810.847%.
Dallas Mavericks of the National Basketball Association announced on 1st March 2021 that it has adopted DOGE as an option of payment.
On 4th March 2021, owner of the Mavericks, Mark Cuban, made it known that “Sometimes in business, you have to do things that are fun”.
Fans of the NBA franchise can use Dogecoin to pay for merchandise as well as tickets through merchant service provider BitPay. With thousands of fans in Dallas, Texas and across the USA, DOGE will gain more usage which could have a significant impact on its price in the near future.
On 16th February 2021, it was reported that CovCare had become the first company to accept Dogecoin. CovCare is a leader in medical supplies.
The healthcare company became the first mainstream company to accept Dogecoin for their online personal protective equipment purchases.
By making such a bold decision in terms of payments in an industry accustomed to the old ways of doing things, CovCare is changing how the health industry operates.
CovCare is a company which receives more than 100,000 orders monthly. Considering the fact that DOGE is now an option of payment due to its fast processing speed and low transactions cost, more people may opt for DOGE in their payments.
As more people patronize the asset, trade volume increases substantially and the valuation of the cryptocurrency may increase.
✅ Social Media Fans and Well-Known Influencers Can Drive Price
Dogecoin started as a joke and in the last 8 years, the only thing which has kept DOGE alive in such a saturated market is its fans. Fans play a great role in discussing the price milestone they want the cryptocurrency to trade for in the near future.
Aside from this, fans use Change.org to petition well-established institutions such as Coinbase to list DOGE as a tradable token. Due to high demand, the platform listed DOGE in June 2021. Fans have also been putting pressure on Amazon to adopt the cryptocurrency as an option of payment in the near future.
Fortunately, social media fans are not the only drivers of the cryptocurrency’s price. Well-known influencers such as CEO of Tesla, Elon Musk, owner of Dallas Mavericks, Mark Cuban, and Snoop Dogg have done well to market the cryptocurrency to new and experienced investors.
On 27th April 2021, Mark Cuban on an appearance on the Ellen DeGeneres Show weighed in on the meme cryptocurrency. Cuban pointed out that Dogecoin is better than a lottery ticket.
Such statements and tweets from influencers go a long way to affect the price of the digital asset.
If unofficial brand marketers carry on alongside aggressive promotion by fans on social media, DOGE may well test the $1 price milestone in the near future.
✅ Amazon and Coinbase Partnership Could See DOGE Rally
Coinbase was listed on NASDAQ in April 2021 while Amazon is the first-mover on electronic books and online retail.
With several petitions being endorsed by thousands of people, DOGE may sink through well-established institutions and become one of the main cryptocurrencies of choice for transactions.
When Coinbase listed Dogecoin, the token's price surged 30%.
If such partnerships keep happen, then DOGE could soar past some of the key price milestones ($1, $5 and $10) being predicted by some experts and analysts.
CONS Of Buying Dogecoin
Despite the promise shown by the joke crypto, Dogecoin has several pitfalls you should consider. Don’t just follow the buzz online and make tremendous losses on your investments. Let us take a look at some of these negatives.
❌ Dogecoin Has Infinite Supply
During its inception as far back as 2013, the creators of the cryptocurrency pegged the maximum supply at 100 billion. By the end of June 2015, the 100 billionth coin had been mined.
Instead of allowing the laws of economics to take place, the creators decided to act to meet the enormous demand of users. They decided to add 5 billion coins annually.
Unfortunately, this decision to meet demand has resulted in a highly inflationary asset. This has torn the basic laws of demand and supply into pieces. If the supply of DOGE continues to go up infinity, theoretically, there will be a drop in price.
With no decentralized finance protocols or applications to back up the price of DOGE, it is relying on its fans as well as integrations and adoptions as an option of payment.
This does not bode well for the future of the cryptocurrency.
❌ Go Bust under Heavy Regulation
Unlike Bitcoin, Ethereum, Bitcoin Cash and Litecoin which can be bought, held and sold on PayPal, Venmo and Skrill, Dogecoin is only available on mainstream cryptocurrency exchanges.
With the cryptocurrency being so decentralized with no maximum supply cap, heavy regulation by financial bodies could see DOGE among the first cryptos to go bust.
Practically speaking, there are too many Dogecoins out there which could be reduced to nothing in a short period of time.
If you consider, DOGE moved from $0.4377 on 16th April to $0.1805 in less than 8 hours due to sell-off, what could happen to the digital asset when strong regulation sets in?
❌ Suffers from Pump and Dump Schemes
There are several outlets on Twitter, Reddit and Facebook where short term holders of the asset who want to make great gains by promoting Dogecoin.
As more people buy, the price of DOGE increases. Meanwhile, short term holders start selling. This leaves inexperienced traders and investors in the red. Any form of investment made should bring long term gains and not short term rewards.
Currently, DOGE is being treated as a form of investment gambling where you make profits today and suffer huge losses tomorrow. Kindly take note of that.
❌ Unfavourable Reserve Risk
Currently, the number of people who are willing to sell DOGE outnumber the people who are willing to hold it.
This makes DOGE an unattractive investment since it shed 58.7617% of its price on the same day it reached an all-time high. There are not many long term investors of DOGE and investing a large amount of money at the moment is not seen as favourable.
Remember that cryptocurrencies are volatile assets. Only invest an amount of money you are willing to lose. On the other hand, you can include DOGE on your portfolio of investments along with stocks, bonds, metals and commodities. This would balance any losses you may incur in the future.
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Read More: How to Buy Dogecoin - Beginner’s Guide
Dogecoin Price Prediction: What Are Analysts Saying About Dogecoin?
Several analysts and experts have opined as to whether Dogecoin is a good investment in 2022 and beyond.
While some remain bullish about the future of the digital coin, few are not so sure that the joke crypto can survive heading into the future.
Let us take a look at what analysts have in store for the crypto trading asset.
Coin Price Forecast predicts the price of Dogecoin to be valued at $0.18 per coin by the end of December 2022. The website further predicts Dogecoin to have a price of $0.19 by the end of 2023, $0.24 in 2024, $0.36 in 2026, $0.38 in 2027, $0.43 in 2028, $0.37 in 2029 and reaching the $0.41 mark price in 2030.
The Economy Forecast Agency, predicts DOGE to have a trading price of $0.09 by the year’s end of 2022. Analysts at Long Forecast further predict the price of Dogecoin to have a price of $0.16 by the end of 2023 and $0.16 in 2024.
Previsioni Bitcoin remains optimistic about the future of the Dogecoin cryptocurrency. The platform predicts DOGE to close at 31st December 2022 with a price of $0.19.
According to CryptoNewsZ, The price of DOGE will be valued at 0.15 and may hit a potential high of around $0.17 by the end of 2022. The crypto news site further forecast the crypto trading asset to trade at a potential low of $0.18 and potential high of $0.22 by the end of 2023.
Crypto Ground predicts Dogecoin will be worth about $0.225 by the end of 2022 and $0.63 to close out 2026.
WalletInvestor predicts the Dogecoin 'joke' cryptocurrency to have a price of $0.234 by the end of 2022. Experts at WalletInvestor further forecast $0.373 (2023), $0.51 (2024), and $0.797 by December 2026.
According to DigitalCoin the value of Dogecoin will be priced at $0.17 per token by the very end of 2022, $0.18 in 2023, $0.18 in 2024, $0.24 in 2025, $0.21 in 2026, $0.28 in 2027, $0.40 in 2028 and $0.50 in 2029.
Analysts at CoinPedia predict Dogecoin to reach a price of $0.38 by the end of 2022. They further forecast DOGE could reach up to $1 in the next 5 years.
What Will Dogecoin Be Worth in 2025?
Coin Price Forecast predicts the price of Dogecoin to traded at $0.30 by December 2025. Long Forecast thinks Dogecoin to have a price of at least $0.20 by the very end of 2025.
CryptoNewsZ predicts Dogecoin to trade at $0.36 by the end of 2025. Crypto Ground estimates the price of DOGE, meme cryptocurrency, to have a value of at least $0.56 by the end of 2025.
WalletInvestor predicts Dogecoin to have a trading price of $0.567 by the end of 2025. While DigitalCoin forecasts Dogecoin to trade for a coin at $0.24 by the end of 2025.
What Will Dogecoin Be Worth in 2030
Coin Price Forecast predicts a trading price of $0.39 to close out June and trade for a coin at $0.41 by the end of 2030.
Don't Miss: Dogecoin Price Predictions
Will Dogecoin Get to $1?
According to CoinPedia Dogecoin could reach a potential high price of $1 in the next 5 years.
Priceprediction predicts the joke cryptocurrency could reach $1 by the end of 2027.
Can Dogecoin Reach $10?
No price prediction shows that Dogecoin DOGE may reach $10 any time soon.
Can Dogecoin Reach $100?
There are no price predictions where DOGE could reach $100. One thing you should know as an investor is that DOGE primarily functions as a transactional currency.
It has competition from Bitcoin Cash (BCH), Dash (DASH) and Litecoin (LTC) which are all used to send and receive money over the internet. Additionally, they can also be used to pay for goods and services online.
If developers of Dogecoin upgrade its blockchain so that it could have decentralized protocols and applications, DOGE could reach $100.
At the time being, it’s all-time high is $0.7376 and the next price milestone being targeted by experts and analysts is $1.
The Bottom Line - Should You Buy Dogecoin?
Dogecoin is worth buying as per most of the analysts. Dogecoin’s rally in 2021 coupled with extensive patronage by experienced and novice investors’ suggests its future is bright.
Most Dogecoin price predictions suggest that the DOGE altcoin can expect to see significant growth over the coming years. Leading analysts vary wildly on their forecasts - but if even the most conservative prediction pan out, anyone who chooses to buy Dogecoin could see a good return.
The Dogecoin altcoin has huge potential for growth due to its payment system as it continues to grow, DOGE may well prove to be an excellent investment over both the short term and long term.
DOGE has partnerships with the Dallas Mavericks which has a huge following. With thousands of fans using DOGE to buy the team’s merchandise, the increased activity could contribute to awesome trade volumes. Such trade volumes would result in the overall valuation of the cryptocurrency.
Additionally, DOGE has partnerships with NEWEGG and COVCARE which employs the coin as an option of payment.
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Can Dogecoin Make Me Rich?
Dogecoin could make you rich depending on the price of the cryptocurrency at the time of purchase and the potential high you expect it to reach.
DOGE has made some investors rich since they purchased hundreds and thousands of the cryptocurrency when it was trading at a fraction of a cent. Suppose you purchase 10,000 DOGE at its current price of $0.12 at the time of writing, it would cost you $1,200.
Suppose DOGE was to reach $1 someday, selling your DOGE will result in $10,000 and bring $9,800 in profit.
Can You Use Dogecoin for Anything?
Dogecoin, like all cryptocurrencies, can be used on online retail outlets which have integrated it as a payment option. DOGE is accepted by more than 1,000 companies across the internet, crypto, gambling and hospitality industries to pay for goods and services.
Some of these outlets are Park & Finch which specializes in fashion and clothing. Others are Quantum Investment Limited, online security network WPSec and online games platform Playhub Casino.
Does Elon Musk Own Dogecoin?
Elon Musk is known as one of the major influencers of Dogecoin’s surge in price in 2021. The technology mogul has tweeted on more than one occasion about DOGE.
So far, he along with his company has not announced a purchase of the cryptocurrency. However, Musk’s company, Tesla, has invested approximately $1.5 billion in Bitcoin and has enabled BTC to be used as an option of Bitcoin for Tesla products.
In terms of ownership, DOGE was founded by software developers Billy Markus and Jackson Palmer. Elon Musk is just a fan of the cryptocurrency.
Is Dogecoin Unlimited?
Currently, the circulating and total supply of the digital asset found on cryptocurrency data aggregation website CoinMarketCap stands at 132.67B DOGE. There is no figure for the maximum supply.
Can Dogecoin Be Like Bitcoin?
No, Dogecoin in its current state can never be like Bitcoin. Although all cryptocurrencies and cryptocurrencies are volatile, the current volatility ratio of DOGE stands at 0.61 while BTC stands at 0.79 in the last 30 days.
With the statistics provided, you can see there is no degree of comparison. DOGE is extremely volatile and can make great gains which can then be followed by a price plunge leading to huge losses for investors.
The other reason why DOGE can never be like Bitcoin is its SUPPLY. The total supply of DOGE is 132 billion while the total supply of Bitcoin is 18,991,000 from a maximum supply of 21,000,000. DOGE remains unlimited.
Once the maximum supply of BTC has been mined, that is when scarcity will set in. This would see Bitcoin trade for a price which could be more than 100,000 or 1,000,000 times that of Dogecoin.
Is Dogecoin A Joke?
Dogecoin is normally referred to as a joke because of the reason behind its creation. The founders of the cryptocurrency Billy Markus and Jackson Palmer felt a need to poke fun at Bitcoin and Litecoin.
They were utterly amazed that cryptocurrencies, which are decentralized, were trying to break into a financial system which has so far been controlled by intermediaries.