What is Dogecoin?
Dogecoin (DOGE) is an open-source, peer-to-peer cryptocurrency created as a satire of the cryptocurrency market after the founding of Bitcoin. It was initially created as a light-hearted joke for crypto enthusiasts, but quickly exploded and became one of the leading cryptocurrencies today.
Dogecoin’s logo is based on a popular meme at the time, the image of a Shibu Inu dog. Dogecoin was created in December 2013 and is based on the same underlying technology as other cryptocurrencies such as Bitcoin and Litecoin.
However, Dogecoin has introduced a number of improvements, including faster access speeds and cheaper transactions. Additionally, it receives support from a strong community around DOGE, popularly known as the “Doge Army.”
Dogecoin uses a simplified variant of the Scrypt consensus algorithm. It also uses a proof-of-work (PoW) protocol, allowing it to receive work from other Scrypt-based networks. Mining Dogecoin is less energy intensive than Bitcoin’s SHA-256 algorithm.
How does Dogecoin work?
Dogecoin is indirectly based on Bitcoin’s code. More specifically, it was created from a hard fork of Luckycoin, which no longer exists, and Luckycoin was a hard fork of Litecoin (LTC). Litecoin is known as the first hard fork ever created when it split from Bitcoin. Dogecoin borrowed the Scrypt-based consensus mechanism from Litecoin, which is why DOGE shares many functions with Bitcoin and its hard forks. The use of Scrypt in Dogecoin’s Proof-of-Work (POW) algorithm prevents miners from using ASICs – specialized equipment used in Bitcoin mining.
Like Bitcoin, participants in Dogecoin’s blockchain network use their computing power to secure the network and create new blocks while verifying transactions. The difference is that Dogecoin has a “lightweight” architecture, allowing DOGE to process transactions more quickly than Bitcoin. Dogecoin can be mined using the computing power of network participants to create new blocks and confirm transactions by solving mathematical equations. For each block created, miners are rewarded with 10,000 DOGE.
Dogecoin creators, Jackson Palmer and Billy Markus, originally designed it with a maximum limit of 100 billion DOGE. However, the team removed this limitation just a few months after launch. Following this change in monetary policy, Dogecoin now has an inflationary supply, creating 5 billion new DOGE every year.
History of Dogecoin
The Dogecoin blockchain – and the DOGE cryptocurrency that powers it – were originally created as a joke in late 2013 by software engineers Billy Markus and Jackson Palmer. Billy Markus works at IBM, and Palmer is a software engineer at Adobe, and both share the vision of developing a fun and easy-to-use cryptocurrency that is different from traditional banking systems. boring while offering almost zero fees for instant transactions.
Billy Markus and Jackson Palmer
The story of Dogecoin began with the idea of creating a cryptocurrency that could be used by a wider group of people than Bitcoin, and the first step was taken when Palmer purchased the domain name Dogecoin.com and created the website Project official. After launching DOGE and recording a trading volume of millions of dollars in its first days on the market, the project’s official website also received an equal number of unique visits.
Even after the successful launch of the DOGE coin, neither Palmer nor Markus took on the title of CEO, and the role of the Dogecoin community became more important to the network. The Dogecoin (DOGE) community has shown its strength on more than a few occasions, notably by raising enough money to cover the loss caused by millions of DOGE coins being stolen in a hack attack on the Dogewallet project now no longer exists.
What makes Dogecoin valuable?
The value of Dogecoin in the market is determined and shaped by the balance between buying and selling activities, which in turn form the price. A major source of this value comes directly from the strong and supportive community of the project, along with the unique approach that DOGE has chosen as a cryptocurrency for online payments.
The value of Dogecoin can also increase due to support, as in the case of Elon Musk tweeting about DOGE being one of the most interesting digital assets on the market, after which Dogecoin price skyrocketed to the moon. ” as the investment community often says.
The value of Dogecoin and the DOGE price can also track major global trends, which form the general dynamics of all cryptocurrencies in the market. DOGE price is subject to general trends, often driven by Bitcoin, the cryptocurrency with the largest market capitalization. DOGE’s use case also plays a role in Dogecoin’s value, as the DOGE cryptocurrency is primarily used as a reward on social media platforms, to tip content creators, and Send and receive micropayments with almost zero fees.
How secure is the Dogecoin network?
The Dogecoin network depends on miners to secure the blockchain and validate transactions. PoW (Proof-of-Work) rules are enforced through full nodes, and miners use computing power to solve mathematical equations. By solving an equation, a new block is created, transactions are verified and permanently recorded, and miners are rewarded with 10,000 DOGE.
How to mine Dogecoin
Dogecoin mining is mostly unprofitable due to its low value. However, the recent price increase of DOGE has created an opportunity for miners. It is important to remember DOGE volatility when starting mining.
DOGE mining process
The hardware used in Dogecoin mining is called Dogeminer. This is simply a node in the Dogecoin blockchain that calculates mathematical equations to check and confirm incoming transactions on the network. Nodes determine which validated transactions are included in the Dogechain (Dogecoin blockchain) and integrate them into blocks, which are then permanently recorded on the shared ledger.
Miners receive DOGE as a reward for performing these complex mathematical calculations. Dogechain releases 10,000 DOGE every minute, which is received by the fastest miner to confirm an incoming transaction.
Choose the right hardware
The first step in DOGE mining is choosing your hardware. While you can still use a computer processor (CPU) and graphics card (GPU), CPU usage is not recommended for cryptocurrency mining. GPUs are more efficient than CPUs but have the problem of poor heat dissipation. The emergence of ASIC miners has made them the most popular hardware due to their efficiency and profitability.
Since Dogecoin runs on the Scrypt algorithm, there are specialized Scrypt ASIC miners that are optimal hardware for DOGE mining. Scrypt ASIC miners are also significantly more profitable than GPUs. Prominent Scrypt ASIC miners for Dogecoin on the market include:
To prolong and maintain the life of the hardware, miners should ensure the hardware has adequate temperature control through coolers, soundproofing, and storage space for the equipment. The best places are often cool, soundproof, and have uninterrupted power.
Dogecoin mining software
Dogecoin mining software allows miners to connect to the Dogecoin blockchain to begin the mining process. However, it is necessary to ensure that the software application is compatible with the hardware being used. Notable Dogecoin mining applications include:
Dogecoin mining method
There are three basic methods to mine DOGE, including:
- Personal exploitation – Individual miners. This may not be sustainable or profitable due to competition for block rewards from large mining pools with higher computing power. However, individuals with high computing power can still give it a try.
- Join mining pool – Individual miner pools pool their computing power resources together to increase their chances of receiving block rewards. Joining a mining pool also alleviates the burden of high energy costs. Popular Dogecoin mining pools include Multipool, Antpool, Prohashing, and AikaPool.
- Cloud mining – Miners pay a monthly or annual fee to an online data center to mine on their behalf. Cloud mining options for DOGE include Genesis Mining and Nicehash.
Mr. Giao
Bitcoin Magazine
