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Dogecoin

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Dogecoin
Unit
PluralDOGE, Dogecoins
SymbolÐ,[1] Ɖ,[citation needed] D‎
NicknameDoge
Demographics
Date of introductionDecember 8th, 2013
User(s)International
Valuation
InflationApproximately 100 billion coins to be mined by end of 2014. Thereafter, 5.2 billion new coins per year.

Dogecoin (/ˈdoʊdʒkɔɪn/ dohjkoyn,[2] code: DOGE, symbol: Ð[1] and D), is a Litecoin-derived[3] cryptocurrency that features the Shiba Inu from the "Doge" Internet meme on its logo.[4][5]Cite error: The <ref> tag has too many names (see the help page).Cite error: The <ref> tag has too many names (see the help page). It was introduced on December 8, 2013.[6] Dogecoin has a fast initial coin production schedule compared to other cryptocurrencies. There will be approximately 100 billion coins in circulation by the end of 2014. Thereafter, 5.2 billion coins will be produced per year. As of 13 February 2014, nearly 50 billion Dogecoins have been mined.[7] While there are currently few commercial applications for Dogecoin, the currency is gaining traction as an Internet tipping system, in which social media users grant Dogecoin tips to other users for providing interesting or noteworthy content.[8] Many members of the Dogecoin community use the phrase "To the moon!", which describes the overall sentiment of rising value.[9][10][11]

Overview and history

File:Dogecoin Paper Wallet.jpg

Dogecoin was created by programmer Billy Markus of Portland, Oregon. He hoped to make a fun cryptocurrency that could reach a broader demographic than the investors who made up Bitcoin's economy and something that wouldn't be involved with the controversial history behind Bitcoin, namely its association with the Silk Road.[12]

At the same time, Jackson Palmer, a worker for a marketing department in Sydney, Australia, for Adobe Systems, and the original individual who first conceived of the idea for Dogecoin, was encouraged by a student at Front Range Community College on Twitter to make the idea a reality.[13]

After receiving several mentions on Twitter, Palmer purchased the domain dogecoin.com and added a splash screen with the coin logo and scattered comic sans text of "doge-speak". Markus saw the site linked in from an IRC Chat room, thought it was funny, quickly edited the parameters and created the Dogecoin wallet, and reached out to Palmer. A few days later, the coin was launched and made a reality.[14] Markus based Dogecoin on the existing cryptocurrency Luckycoin,[15] from which it derives its randomized reward received for mining a block. In turn, Luckycoin is based on Litecoin,[3] which also uses scrypt technology in its proof-of-work algorithm, meaning that miners cannot take advantage of specialized Bitcoin-mining equipment to mine at higher speeds. The Dogecoin network was originally intended to produce 100 billion Dogecoins.[16][17][18]

On December 19, 2013, Dogecoin jumped more than 300 percent in value in 72 hours, rising from USD$0.00026 to $0.0095,[19] with a volume of hundreds of Bitcoins per day[20] during a time when Bitcoin and many other cryptocurrencies were reeling from China's decision to forbid Chinese banks from investing Chinese Yuan into the Bitcoin economy.[3] On December 22, 2013, Dogecoin experienced its first major crash by dropping by 80% due to large mining pools seizing opportunity in exploiting the very little computing power required at the time to mine the coin.[21]

On December 24, 2013, The Reserve Bank of India cautioned users of Dogecoin and other virtual currencies on the risks associated with them.[22] On December 25, 2013, the first major theft attempt of Dogecoin occurred when millions of coins were stolen during a hacking attempt on the online wallet platform Dogewallet.[23] The hacker gained access to the platform's filesystem and modified its send/receive page to send any and all coins to a static address.[24][25] This incident spiked Tweets about Dogecoin making it the most mentioned altcoin on Twitter.[26] By January 2014, the trading volume of Dogecoin surpassed that of Bitcoin and all other crypto-currencies combined.[27]

On January 19, 2014, a fundraiser was established by the Dogecoin community to raise $50,000 for the Jamaican Bobsled Team, which had qualified for, but could not afford to go to, the Sochi Winter Olympics; $30,000 was donated by the second day,[28] and the Dogecoin to Bitcoin exchange rate rose by 50%.[29][30][31][32][33] As of 13 February 2014, Dogecoin has a market capitalization of USD$81 million.[34] The Dogecoin community has raised funds for a second Sochi athlete Shiva Keshavan.[35]

Use and exchanges

Several online exchanges offer DOGE/BTC [36] and DOGE/LTC [37] trading. A single exchange, Bter, offers DOGE/CNY [38] trading. On January 8, 2014, AltQuick.co was the first exchange to launch DOGE/USD exchange.[39] On January 30, 2014, Canada-based exchange Vault of Satoshi also announced DOGE/USD and DOGE/CAD trading.[40][41] On February 2014, Hong Kong-based exchange Asia Nexgen announced that they would support the trading of Dogecoins in all major currencies. China-based exchange BTC38 also added their support on the Dogecoin exchange, boosting the market capitalization over 24 hours. [42][43] In the first day of trading, Dogecoin was the second-most traded currency on the platform, after BTC.[44]

On January 31, 2014, trading volume across the major exchanges was valued at $1.05 million USD. The market cap was USD$60 million. Three exchanges accounted for the majority of volume: Bter (60%). Cryptsy (23%), and Vircurex (10%). The most traded currency pairs were DOGE/BTC (50%), DOGE/CNY (44%) and DOGE/LTC (6%).[45]

Trading physical, tangible items in exchange for DOGE takes place on online communities such as Reddit and Twitter.[46][47]

On December 23, 2013, Tristan Winters of the online journal Bitcoin Magazine discussed what was needed for Dogecoin to replace Bitcoin.[48]

Transactions

Dogecoin functions using public-key cryptography, in which a user generates a pair of cryptographic keys: one public and one private. Only the private key can decode information encrypted with the public key; therefore the keys' owner can distribute the public key openly without fear that anyone will be able to use it to gain access to the encrypted information. All Dogecoin addresses are public key hashes; they are a string of 34 numbers and letters starting with the letter D. An example address (public key) is DJ7zB7c5BsB9UJLy1rKQtY7c6CQfGiaRLM, that belongs to Dogecoin Foundation[49] The public key is the Dogecoin address to which other users can send Dogecoins. The private key, however, allows full access to the Dogecoin wallet; it must be kept secret and secure.

Mining parameters

Dogecoin's implementation differs from Litecoin by several parameters. Dogecoin's block time is 1 minute, and the difficulty retarget time is 4 hours. Each block rewards miners with a random number of coins between 0 and a defined maximum, given in the block schedule listed below. From block 600,001 onwards, there will be a fixed reward of 10,000.[6] Reward is calculated using Mersenne Twister pseudo-random number generator.[50]

Block schedule

Block Numbers Per-Block Reward First Block Expected Coins Produced (approx) Expected Total Circulation (approx)
1-100,000 0-1,000,000 (random) 8 December 2013 [51] 50,000,000,000 50,000,000,000
100,001-200,000 0-500,000 (random) 14 February 2014 [52] 25,000,000,000 75,000,000,000
200,001-300,000 0-250,000 (random) 25 April 2014 (estimated) 12,500,000,000 87,500,000,000
300,001-400,000 0-125,000 (random) 3 July 2014 (estimated) 6,250,000,000 93,750,000,000
400,001-500,000 0-62,500 (random) 10 September 2014 (estimated) 3,125,000,000 96,875,000,000
500,001-600,000 0-31,250 (random) 19 November 2014 (estimated) 1,562,000,000 98,437,500,000
600,001+ 10,000 (fixed) 27 January 2015 (estimated) 5,256,000,000 per year No limit

Currency supply

Unlike some other cryptocurrencies, there is no limit to how many Dogecoins can be produced. According to the schedule, approximately 98 billion coins will have been released by January 2015, when block 600,000 is mined. Thereafter, approximately 5.2 billion more coins will be produced per year, in perpetuity. During December 2013 and January 2014, Dogecoin's developers discussed in public forums whether this should be changed.[17][53] On February 2, 2014, Dogecoin founder Jackson Palmer announced that the supply of coins would remain uncapped.[54]

References

  1. ^ a b "README.md". Dogecoin Integration/Staging Tree (Source code). February 5, 2014. Retrieved February 17, 2014.
  2. ^ Stephen Hutcheon. "The rise and rise of dogecoin, the internet's hottest cryptocurrency". Sydney Morning Herald. Fairfax Media. Retrieved 23 January 2013.
  3. ^ a b c David Gilbert (20 December 2013). "What is Dogecoin? The Meme that Became the Hot New Virtual Currency". International Business Times. Retrieved December 2013. {{cite web}}: Check date values in: |accessdate= (help)
  4. ^ Andrew Couts (12 December 2013). "Wow. Dogecoin is the most Internet thing to happen, ever". Digital Trends. Retrieved December 2013. {{cite web}}: Check date values in: |accessdate= (help)
  5. ^ Brittany Hillen (10 December 2013). "Dogecoin digital currency takes on Bitcoin with a bit of meme flair". Slashgear. Retrieved December 2013. {{cite web}}: Check date values in: |accessdate= (help)
  6. ^ a b "Dogecoin - very currency many coin". Retrieved 30 January 2014.
  7. ^ "Dogechain - The official dogecoin blockchain!". Dogechain.info. Retrieved 2014-01-25.
  8. ^ "An Interview With The Creator Of Dogecoin: The Internet's Favourite New Currency". Junkee.com. Retrieved 2014-01-22.
  9. ^ Andrew Couts (December 19, 2013). "To the moon! Dogecoin fetches 300 percent jump in value in 24 hours". Digital Trends. Retrieved January 22, 2014.
  10. ^ Andrew Couts (January 20, 2014). "Dogecoin users raise $30,000 to send Jamaican bobsled team to Winter Olympics". Digital Trends. Retrieved January 22, 2014.
  11. ^ Derek Ross (December 31, 2013). "Much application. Such coin. Very Android. Dogecoin Wallet now available on Google Play". Phandroid. Retrieved January 22, 2014.
  12. ^ Patrick McGuire. "Such Weird: The Founders of Dogecoin See the Meme Currency's Tipping Point". Motherboard. Vice Media. Retrieved 23 December 2013.
  13. ^ Rob Wile (19 December 2013). "What is Dogecoin?". Business Insider. Retrieved December 2013. {{cite web}}: Check date values in: |accessdate= (help)
  14. ^ Ashe Schow (19 December 2013). "Internet gold: Doge + Bitcoin = Dogecoin". Washington Examiner. Retrieved December 2013. {{cite web}}: Check date values in: |accessdate= (help)
  15. ^ http://www.seattlepi.com/technology/heavy/article/Dogecoin-5-Fast-Facts-You-Need-to-Know-5079680.php
  16. ^ Danny Vega (9 December 2013). "Dogecoin: 5 Fast Facts You Need to Know". Heavy.com. Retrieved December 2013. {{cite web}}: Check date values in: |accessdate= (help)
  17. ^ a b "Not actually capped at 100 billion?".
  18. ^ Miles Klee (10 December 2013). "With its own cryptocurrency, Doge has officially conquered 2013". The Daily Dot. Retrieved December 2013. {{cite web}}: Check date values in: |accessdate= (help)
  19. ^ Andrew Couts (19 December 2013). "To the moon! DogeCoin fetches 300 percent jump in value in 24 hours". Digital Trends. Retrieved December 2013. {{cite web}}: Check date values in: |accessdate= (help)
  20. ^ Nekomata (25 December 2013). "2014: The Year of Dogecoin? And where to buy DOGE". KonNeko.com. Retrieved January 2013. {{cite web}}: Check date values in: |accessdate= (help)
  21. ^ Rob Wile (22 December 2013). "Dogecoin Prices Crashed This Weekend". Business Insider. Retrieved December 2013. {{cite web}}: Check date values in: |accessdate= (help)
  22. ^ "RBI cautions users of Virtual Currencies against Risks" (PDF). 24 December 2013. Retrieved December 2013. {{cite web}}: Check date values in: |accessdate= (help)
  23. ^ Ashley Feinberg (26 December 2013). "Millions of Meme-Based Dogecoins Stolen on Christmas Day". Gizmodo. Retrieved December 2013. {{cite web}}: Check date values in: |accessdate= (help)
  24. ^ Catherine Shu (25 December 2013). "Such Hack. Many Dogecoin. Very Disappear. So Gone. Wow". TechCrunch. Retrieved December 2013. {{cite web}}: Check date values in: |accessdate= (help)
  25. ^ Salvador Rodriguez (26 December 2013). "Millions of Dogecoins, currency based on a meme, are reported stolen". Los Angeles Times. Retrieved December 2013. {{cite web}}: Check date values in: |accessdate= (help)
  26. ^ Ofir Beigel (7 January 2014). "Please, not another coin - which altcoins are worth taking a look at". 99Bitcoins. Retrieved January 2014. {{cite web}}: Check date values in: |accessdate= (help)
  27. ^ John Russell (15 January 2014). "Dogecoin is the Bitcoin world's most traded currency, but it's unlikely to be its most valuable". The Next Web. Retrieved January 2014. {{cite web}}: Check date values in: |accessdate= (help)
  28. ^ "Dogecoin Jamaican Bobsled Team Olympics". Business Insider. 2014-01-20. Retrieved 2014-01-25.
  29. ^ Alex Hern. "It's bobsleigh time: Jamaican team raises $25,000 in Dogecoin | Technology". theguardian.com. Retrieved 2014-01-25.
  30. ^ Rodriguez, Salvador (2014-01-20). "Jamaican bobsled team boosts value of Dogecoin, currency based on meme". latimes.com. Retrieved 2014-02-02.
  31. ^ "Dogecoin Jamaican Bobsled Team Olympics". Business Insider. 2014-01-20. Retrieved 2014-02-02.
  32. ^ "Jamaican bobsled team raises $30,000 in Dogecoin for trip to Sochi | The Rundown | PBS NewsHour". PBS. Retrieved 2014-02-02.
  33. ^ Alex Hern. "It's bobsleigh time: Jamaican team raises $25,000 in Dogecoin | Technology". theguardian.com. Retrieved 2014-02-02.
  34. ^ "Crypto-Currency Market Capitalizations | DogeCoin 30-Day Market Cap Graph". Coinmarketcap.com. Retrieved 2014-02-02.
  35. ^ Devin Coldewey (2014-01-29). "Dogecoin cryptocurrency donors help send Indian athletes to Sochi". NBC News.com. Retrieved 2014-02-02.
  36. ^ http://www.cryptocoincharts.info/#jump-doge-btc
  37. ^ http://www.cryptocoincharts.info/#jump-doge-ltc
  38. ^ "Bitcoin and Crypto-currency Exchange Platform". Bter.com. Retrieved 2014-01-25.
  39. ^ dcmagnates.com. "AltQuick.co Becomes Man's 2nd Best Friend: Allows Dogecoin Buying with USD".
  40. ^ coindesk.com. "Vault of Satoshi Rolls Out New Altcoin Support".
  41. ^ "Vault of Satoshi Adds New Alt-Coins and a CAD Order Book, Coin-to-Coin Trading Imminent". Yahoo Finance. Retrieved 31 January 2014.
  42. ^ coindesk.com. "Asian Exchange Additions Drive Dogecoin Price Surge".
  43. ^ ibtimes.co.uk. "Cryptocurrency News Round-Up: London Bitcoin ATM Update and Dogecoin Joins Two Exchanges".
  44. ^ "Dogecoin and Quarkcoin Hot, Other Altcoins Not, on First Day Vault of Satoshi Trading". Digital Currency Magnates. Retrieved 31 January 2014.
  45. ^ "DOGE charts and information". DOGE/BTC and DOGE/CNY. Retrieved 31 January 2014.
  46. ^ Nathan Ingraham (16 December 2013). "Bitcoin is so 2013: Dogecoin is the new cryptocurrency on the block". The Verge. Retrieved December 2013. {{cite web}}: Check date values in: |accessdate= (help)
  47. ^ J. Duaine Hahn (16 December 2013). "Move Over Bitcoin: Dogecoin is Here". Complex Tech. Retrieved December 2013. {{cite web}}: Check date values in: |accessdate= (help)
  48. ^ http://bitcoinmagazine.com/9109/will-dogecoin-replace-bitcoin/
  49. ^ "Donation directory". foundation.dogecoin.com. Dogecoin Foundation. Retrieved 2014-01-25.
  50. ^ "Dogecoin C++ code for generating block rewards".
  51. ^ "Dogechain - The official Dogecoin blockchain!". Blockchain Record for Block 1. Retrieved 30 January 2014.
  52. ^ "Dogechain - The official Dogecoin blockchain!". Blockchain Recoid for Block 100000.
  53. ^ "You should all be aware of this: Current algorithm increases the supply by at least 5,256,000 D yearly for eternity. The devs plan to make the supply fixed". Reddit. Retrieved 30 January 2014.
  54. ^ "Dogecoin to allow annual inflation of 5 billion coins each year, forever". Ars Technica. Retrieved 4 February 2014.
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