When Jackson Palmer created Dogecoin and launched the cryptoasset on December 6, 2013, he certainly didn’t expect a potential Mars colonizer to talk about it on a social media platform.
Fast forward to 2021, and Dogecoin has shot up over 800% in a flash, fueling chaos and causing popular media to finally take note of the cryptocurrency. This has been the story of DOGE this year, the world’s most popular coin.
Dogecoin, at the time of writing, was one of the top 15 assets with a market cap of $ 6.77 billion.
Dogecoin, Elon Musk and his latest concern
Musk has been extremely vocal about Dogecoin. In fact, the impact of the CEO of Tesla is such that every time he tweeted positively to his 47 million followers on Twitter, the crypto asset has accelerated in the market.
Recently, however, Musk grabbed the headlines after raising a serious and legitimate concern about the concentration of whales.
The first 100 addresses hold 68.1% of the total supply. For context, the top 100 Bitcoin addresses hold 13.7% of the supply.
Now the issues with Dogecoin go beyond its narrative of concentration, and there are several reasons why the cryptoasset should not be viewed as a significant digital asset.
What’s the policy?
While DOGE’s offer was originally supposed to be $ 100 billion, it was updated to an unlimited offer later. The advantage of such a change is that the price will remain stable for DOGE, but the disadvantage is that the prices “should” remain low. And yet, a low-priced currency saw an 800% rise on the charts. This highlights his second concern.
Any crypto whose price can be manipulated by tweets or a community might not be considered reliable. Such volatility has already driven people away from crypto, but Dogecoin gives it a whole new meaning and, for a change, has drawn in people hungry for profit as well.
Does its security and technology combine?
Dogecoin’s code shares many similarities with Bitcoin’s script, but it should be noted that this was a fork of the now-obsolete Luckycoin, which was itself a fork of Litecoin. In this regard, even if it does not really present a loophole, its inflationary supply has many factors to take into account. First, its faster blocks come at the cost of a large number of orphan blocks that do not contribute to transaction history.
Second, Dogecoin does not have a fixed core development team. Most of its developers are all core developers. They are heavily involved in other projects. Most come together simply because of the level of activity recently observed by the cryptoasset.
Finally, Dogecoin’s hashrate was around 300 terahash, at the time of writing. In comparison, Bitcoin was 161 exahash, or 161 million tera hashes. Ergo, it’s perhaps safe to say that a 51% attack would be a snap if the network ever became extremely valuable (which it won’t be).
Dogecoin will survive, but will remain a joke
Community engagement is undeniable in the open ledger industry and the recent episode of WallStreetBets has given all investors a new perspective on how to beat or fool the system. While many are currently campaigning for Dogecoin to hit $ 1, which can sincerely happen if the stars align, it will never be taken seriously. Then again, that was never meant to do, right?
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