Hi, Ante here! Over the past week, many have asked me about Dogecoin – what is it exactly, how and where to buy it, is it too late to invest and so on and so forth … And now that the dust has settled a bit, I want to talk about Elon Musk who recently posted a few tweets about Dogecoin and explain exactly how this project recently reached record highs $ 10 billion in market capital. But first, a little background! Let’s start with the definition of Dogecoin. It’s usually called a “meme coin,” and they created it two software engineers Billy Markus and Jackson Palmer in December 2013.
Similar to Bitcoin, it allows Peer-to-Peer transactions via a decentralized network, but Bitcoin and Dogecoin are more different than they are similar to each other. The Dogecoin logo is actually a Doge meme which is Shiba Inu, a Japanese breed of dog. And the dog meme was extremely popular back in 2013. Which isn’t weird, because he’s pretty funny with misspelled nonsense everywhere. Today, Dogecoin is used to tip content creators on social media, sometimes to buy physical stuff on Reddit and Twitter, and sometimes even to buy and rent houses! So how did Dogecoin come about in the first place? Well, like I said, it was a joke.
And that comes from the creators themselves. They literally merged the two things that were most talked about in 2013 – cryptocurrencies and Doge memes. And what they did was they took the source code of Bitcoin, which is publicly available because it's open source, or more precisely, they took the source code of Litecoin. But Litecoin first took Bitcoin's source code and made a "fork." And making a fork means they made a similar, but separate, blockchain using it source code. So Dogecoin is actually a fork fork. But anyway, then they are within the code set a few things, such as the amount of individuals, so instead of 21 million Bitcoins and 84 million units of Litecoin, Doge limited to 100 billion units, which was later removed, so Doge more there are no limits either, so there will be an unlimited number of Doge pieces. Another change they made in the code is yes instead of using the word “mining” to create new units, as Bitcoin does, they use the word “dig” and a few other trivial modifications like that, and they all did it in three hours! Three hours! And how serious the project was can be seen in one of CNET’s articles in which it is said, "but Marcus and Palmer had not previously mined any Dogecoin because they were not serious about launching a cryptocurrency.
”“ We thought it was one big joke that was going to die out, ”Palmer laughs. But Dogecoin’s online community has grown rapidly and within months is its market value reached $ 60 million. In short, it became popular quite by accident. So, the creation of Dogecoin it was extremely simple, but what about its purpose? What is the problem that Dogecoin solves in the world? And the answer is: none, really. And it also comes from one of the creators, who said, “I don’t think anything it doesn’t solve, in fact, ”he says,“ if anything, it exists as an educational tool. The reminder is yes we can't take these things seriously.
" Now, with all that in mind, how the meme coin, made in jest, succeeded reach a total market capitalization of nearly $ 10 billion? Let's just put it in perspective, Western Union has a market capitalization of about $ 9.5 billion! Currently, the Doge is the 15th largest cryptocurrency in the world, but its history is full of sudden ups and downs. The first in this Coindesca article, which I will leave in the description, as well as all the others I have used in this one video, is from June 2017, when this meme coin grew by more than 1,800%, through 70 days, to a peak of $ 0.0042, but over the next two weeks it fell by 75%.
The second happened in November of the same year, when Doge crashed previous record by 380%, up to 2 cents, but the price fell again, this time by 70%. Following! April 2018! During the last bear market, while the market was recovering briefly, it took Doge with it, which rose 103% to $ 0.0041 and then fell 50% again. According to Coindescu, the next sharp rise was the first to be largely unrelated to the rest of the crypto market. This is due to the Dogecoin / Ethereum bridge system test. It was successfully completed and the price went up by 175% in just 48 hours, but that project never resulted in anything, so … And finally, the latest sharp rise, from January 2021, managed to push Dogecoin into new records in total increase of 1100%.
There are many reasons why he pumped so hard, the first of which is WallStreetBets, a group of Redditors who decided to unite against traditional investors who have massively shortled, or "bet" against, certain companies, such as GameStop, AMC and the like … In short, and without a deliberate play on words, shorting means that you must first borrow shares from someone as well then sell the shares at the current price, with a contract under which you must subsequently return shares. Why you would want to do this is because if the price starts to drop right after the sale or shorta, this allows you to redeem it at a lower price. You can then return the shares to the owner when the contract expires and keep the difference between the outbound and inbound price and thus rotate profit.
So it all ends well if the price drops after the sale, but if it increases, it means yes when the time comes you will have to buy the stock at a higher price than the one at which you sold it, that is, you have to spend more money to return the stock so you can return it to the owner. And when that it happens on a large scale, something called "Short Squeeze" happens, which looks something like this … So what WallStreetBets did was they continued to buy GameStop stocks, which increased the price, forcing the shorts back into the market and buying, which then pushed the price even further. All of this resulted in the bankruptcy of many hedge funds and most of them had to be rescued.
Also, trading platforms, like Robinhead, even made it impossible to buy GameStop shares and only allowed sale, to prevent further price increases, which is quite wrong and one-sided because they always are covered the backs of traditional investors, which is the main reason why WallStreetBets was formed. And also, of course, because traditional investors are constantly using “dying companies "to make a significant profit by killing them early by shortening. But in any case, what happened later is that, let’s call it the “movement” has spread to other types of property, which has encouraged the idea of people organizing into Telegram groups created just to pump certain coins, like XRP.
The joint pumping of XRP was scheduled for Feb. 1, but the rise has, of course, begun a few days earlier and eventually the price exploded by 150%, up to 75 cents, but corrected by 55% over the next 15 hours. The movement is, of course, extended to Dogecoin, which rose insanely, but that was not the only reason for Dogecoin's growth. There’s also that minor thing called “the richest-person-in-the-world-tweeted-about-Dogecoin”. On January 28, Elon Musk tweeted a photo with striking similarities to Dogecoin, so the public went wild and it only added fuel to the fire, which is why Dogecoin reached a price of $ 0.07797.
He also posted two more tweets. He simply said "Doge" to one, and the other immediately followed, saying "Dogecoin is the cryptocurrency of the people." Everything seems to explode in price after Elon Musk tweets about it. But it wasn't the first time he had tweeted about Dogecoin. April 2 In 2019, he responded to a tweet saying that Dogecoin may be his favorite cryptocurrency, so there is a kind of long-standing love, but unfortunately, even Elon Musk can’t sustain it a steep increase in such a coin, and this last increase also received its correction, by 75% in the next day and a half.
And finally, should you invest in Doge as soon as possible or simply ignore? Well, I’ve never owned Dogecoin and probably never will, but I believe it can be made from it make money, at least for some individuals. The thing is, I don’t like that kind of cube, where I would have to wait for the CEO of a large company to get drunk or for a group of people to form and decides to raise the price. Because it doesn’t have any intrinsic value, no solves nothing special, there is no limited amount of units that will ever exist either any other reason that would interest me. But if you are interested, you can get it at many stock exchanges, and I will leave a list of the best in the description, and I will also write and a few steps on how and what to do for all new people in the crypto market.
If you succeed make money on your investment, i am happy for you and be sure to let us know in the comments. Otherwise, I suggest sticking to other, fundamentally stronger projects. Thanks for watching! As always, if the content has helped you in any way, take a second to like it, stay with me for more crypto history lessons in the future, Keep Mining and see you in the Next Block!.