We all know about cryptocurrency at this point. Bitcoin started the trend in 2009 and has increased in value from just 21 INR ($0.3) a decade ago to 40 Lakhs INR($55,000) as I write. This incredible growth has prompted other companies to follow suit, and now there are a whole host of altcoins to invest in.

Alt-coins are any other cryptocurrencies that are not bitcoins. Take a look at any crypto stock site, you’ll see plenty of them. At the time of writing, Monero is 30k INR ($400). Ethereum is a bit over 1.69L INR($2200). And Dogecoin is just $0.04. Somehow, we’ve reached the point where memes have a real-world value.

To explain Dogecoin, you need to go all the way back to 2013. You’ve probably seen the doge meme — the one with the Shiba Inu surrounded by badly spelled, lolcat-style dialog. Very wow. Much doge. Anyway, late in 2013, Dogecoin was created by a pair of software engineers, Billy Markus and Jackson Palmer.

The meme typically consists of a picture of a Shiba Inu dog accompanied by multicolored text in Comic Sans font in the foreground. The text, representing a kind of internal monologue, is deliberately written in a form of broken English. Initially created as a joke, the aim was to design a more recognizable peer-to-peer currency than Bitcoin. And what better way to make something instantly identifiable than taking inspiration from a meme?

In the time since its inception, it’s taken hold as a tipping mechanism for content creators. DogeCoin was developed using the protocols of two other currencies, Luckycoin and Litecoin, due to the fact they used script technology. Because of this, miners can’t use SHA-256 bitcoin mining equipment to get hold of it. They need to use FGPA and ASIC devices instead, which are way more complex to produce. On December 19, 2013, Dogecoin jumped nearly 300 percent in value in 72 hours, rising from US$0.00026 to $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 in 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.

Weirdly (or not so weirdly given its origins), Dogecoin seems to be at the center of trends in the last couple of years. In June 2020, a TikTok trend was trying to help raise its price to $1. Obviously, that’s nowhere near Bitcoin’s $40k, but it would raise the total value to $127 billion. Which is kind of a big deal.

Reddit users drove the value up by more than 800% when the Gamestop short squeeze drama was going on. It’s also had a bit of promotion from everybody’s favorite rich genius, Elon Musk, along with Snoop Dogg, and Gene Simmons.

On March 25, 2014, the Dogecoin community successfully raised 67.8 million Dogecoins (around $55,000 at the time) to sponsor NASCAR Sprint Cup Series driver Josh Wise. Nicknamed the “Moonrocket”, the 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.

If you’ve made it till here, much excite! To get in on the action, here’s what to know.

Investing

If you want to buy Dogecoin in India, you must set up your account on crypto exchanges that support Dogecoin. A cryptocurrency exchange allows the user to buy, sell or trade cryptocurrencies. Here are a few apps you can download and use for buying Dogecoins WazirX, CoinDCX, CoinSwitch, etc. I personally suggest you use this method, as mining is a tad more complex.

Mining

Other than that, your other option is to mine for it yourself. Or in this case, dig. Because dogs dig. If you’ve got a halfway decent PC, you’ll be able to start getting your own share of the pie. However, as the currency begins to reach its limit, it becomes more difficult to get hold of. Which in theory, should drive the value up.

If you’re looking to solo mine (sorry, I can’t bring myself to say dig), you’ll provide the hashing power yourself. The benefit of this is that you’ll be the only person to reap the rewards. This is also the riskier option, as solo mining is better for large-scale operations. You’re more likely to suffer a loss in this way.

As the currency has become more scarce (there is a limit to each altcoin), the hash rate has become incredibly bloated. This means the juice probably isn’t worth the squeeze. You’re more likely to end up with the closely related Litecoin with this approach.

Pooled mining is where lots of people combine their powers. It’s almost as if the Power Rangers grew up, ditched the Megazord, and became a team of investment bankers. With attitude. You’re more likely to get a return on your investment in this way, but the rewards are shared between the members mining. Doing things in this way also means you’ve got more chance of beating the larger operations to the punch.

What you’ll need for mining

A PC. Windows, Mac OS, or Linux will all do the trick. If you’re just tinkering you won’t need much power under the hood, but if you’re getting serious about it, you’ll need a meaty GPU, along with some ASICs (application-specific integrated circuits).

When it comes to software, it’ll depend on what you’re using to mine in the first place. Cpuminer by Pooler is ideal for, well, CPU mining. EasyMiner is awesome for getting going on GPU mining, and if you’re going all-in with ASICs, give CGMiner or MultiMiner ago.

For those jumping into pooling, try Prohashing or Multipool. Both of these support Scrypt mining pools, which is what you’ll need to get your digital paws on Dogecoin.

Dogecoin itself has never actually gone above seven cents since its inception eight years ago. There are also concerns that it’s close to being mined out. For comparison, Bitcoin won’t be fully mined out until 2041. This means a couple of things. First, it’s getting harder to get hold of. Second, it was initially created with 100 billion coins, so there’s a chance it’ll never become particularly successful.

On the other hand, just like any new currency, there’s the possibility that it could be the next big thing…or not!

The most important thing to remember is to not go all-in with Dogecoin. If you are going to buy this cryptocurrency because you think it will just keep on rising, make sure to diversify. It can come down just as quickly.

Therefore, make sure to buy several other cryptocurrencies and/or stocks that can help diversify your total investments. This can help spread out the pain, so to speak, if some stocks or cryptos do worse than others in a downturn.

The image shows how the value of DogeCoin has changed with time. Notice the huge spike and then the drop. Most altcoins, cryptocurrencies other than bitcoins, are deflationary. This means there is a hard cap on the number of coins that will ever be in existence. Bitcoin, for example, with its hard cap of 21 million coins will not have any more new bitcoins come into existence after 2040.

This constraint of having a scarce resource leads to hoarding, as the perceived real value of the currency increases over time. The hoarding activates a deflationary cycle where prices for things get lower while consumers continue to save in anticipation of even lower prices.

In contrast, for a fiat currency like the U.S. dollar, the central bank can issue new money at any time and there’s no limit on how much money they can create. In this aspect, Dogecoin is closer to fiat than bitcoin, which is often considered an asset class akin to digital gold.

While there might be grounds to support the credibility of Dogecoin as a complementary currency, determining so requires a thorough study of its implications as a financial instrument. As an inflationary currency, Dogecoin is not designed to surge like bitcoin, which has a limited supply and is considered an artificially scarce resource.

Dogecoin is no more a joke than memes are empty harbingers of “lols.” As we’ve experienced in the past few weeks, memes can now move markets beyond anyone’s expectations. After all, we are emotional beings, and social media, especially Reddit, has managed to strum our emotional strands in such a way that cultural assets appear to levitate and gravity seems to be pulling financial nuances beyond our purview. Right now, to invest in Dogecoin is to participate in the cultural zeitgeist. That in itself could be considered a worthwhile investment for the meme-culture aficionados.

In April 2018, the RBI banned banks and other regulated entities from supporting crypto transactions after digital currencies were used for fraud. In March 2020, the Supreme Court struck down the RBI’s ban on crypto, terming its circular unconstitutional. One of the SC’s reasons for overturning the ban is that cryptocurrencies are unregulated but not illegal in India.

Sources indicated that the government is open to back a central bank-backed digital currency, an idea mooted by the Reserve Bank of India. The government and the RBI also seem to be in consensus on the issue that private cryptocurrencies may do more harm than good to the financial system and the currency holders. “A fiat currency cannot have the kind of volatility and fluctuations you saw in Bitcoins and other cryptocurrencies. But at the same time, we have an open mind. We are very open to a digital currency, the RBI is working on that,” the official said.

The Cryptocurrency and Regulation of Official Digital Currency Bill, 2021, which aims to prohibit all private cryptocurrencies and lays the regulatory framework for the launch of an “official digital currency” was set to be introduced in Parliament during the Budget session, but was not taken up.

A 3–6 month exit period before banning the trading, mining, and issuing of cryptos has been discussed in inter-ministerial discussions. The high-power inter-ministerial committee has previously recommended a ban on all private cryptocurrencies. So we might see a crypto ban, we might not. Till then, I guess we could stick to our old friend, the Indian Stock market, which you can directly invest any time without fear of de-regularization.

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Source: https://medium.com/iete-sf-mec/dogecoin-is-on-a-run-has-escaped-the-yard-and-is-headed-to-the-moon-43c066b973e3?source=rss——-8—————–cryptocurrency