What happens when a joke gets taken seriously? In 2013, Dogecoin (DOGE) was created as a way to poke fun at the crypto industry; now it's one of the world's biggest cryptocurrencies. How did it get to this point?
What is Dogecoin?
Dogecoin is a cryptocurrency that takes its name from the "doge" Internet meme. It started as a way to mock the industry, but quickly built up a lively community of enthusiasts.
It has come a long way since 2013, briefly hitting a market cap of $88 billion during its May 2021 price surge.
Who created it?
Jackson Palmer, an Adobe employee, couldn’t believe the huge number of altcoins that were popping up in 2013. As a joke, he sent out a tweet saying he was investing in Dogecoin—a fake coin based on a popular meme featuring a Shiba Inu dog.
Even though he tweeted in jest, several people thought he was on to something. They said the industry really needed a light-hearted token that could counter the more controversial coins on offer. So Palmer teamed up with Billy Markus, a programmer, to make Dogecoin a reality.
“It was always like a hobby project, like a side project thing,” Palmer told Decrypt in 2018. But a community quickly formed around the cryptocurrency, and took it much further than Palmer had anticipated.
A brief history of Dogecoin
- Dec 2013 – Dogecoin was founded by Jackson Palmer.
- March 2014 – The Dogecoin community raises $55,000 in DOGE to sponsor NASCAR driver Josh Wise.
- June 2014 – The Dogecoin Foundation is established to preside over the currency's code.
- April 2015 – Co-founder Jackson Palmer leaves Dogecoin.
- January 2018 – Dogecoin briefly surpasses a $2 billion market cap.
- July 2020 – A viral TikTok challenge sends Dogecoin volumes soaring, pushing the price up by 96%. The flurry of price action swiftly passes.
- January 2021 – Dogecoin surges to a market cap of over $9 billion in a price surge orchestrated by the SatoshiStreetBets subreddit.
- May 2021 – Dogecoin's price hits an all-time high of $0.73 in the run-up to Elon Musk's appearance on Saturday Night Live.
- May 2021 – Dogecoin developers reveal that Elon Musk has been advising them since 2019.
- June 2021 – Crypto exchange Coinbase lists Dogecoin.
- November 2022: Elon Musk announces that he will upgrade Dogecoin with Vitalik Buterin.
Did you know?
Billy Markus, Dogecoin’s co-founder, goes by the nickname ‘Shibetoshi Nakamoto’. It’s a play on the doge meme, along with Bitcoin’s mysterious founder Satoshi Nakamoto. In June 2020, he bought back into Dogecoin after "8 years of vowing never to buy crypto again."
What’s so special about it?
- 💨 Speed and cost – Dogecoin offers fast transactions and low transaction fees—both essential for wide adoption.
- 💰 Unlimited supply – Originally Dogecoin was capped at 100 billion coins, but it was later changed to an unlimited supply. That keeps the price relatively stable.
- 🤝 Community – The heart of Dogecoin is its active community. The more than 300,000 members of the r/dogecoin subreddit are renowned for being a friendly and welcoming bunch.
- 🤗 Philanthropy – That same community has been known to rally around good causes. They raised more than $25,000 in Dogecoin to help send the cash-strapped Jamaican bobsled team to the 2014 Olympics. They also teamed up with a water charity to raise thousands to improve clean water access in Kenya through the Doge4Water initiative.
How does Dogecoin work?
The upside of Dogecoin’s never-ending supply of tokens is that the price stays relatively stable. The downside is that the price usually remains very low. Most people get into the crypto world as an investment. They hope that if they hang onto certain tokens long enough, they can sell for a profit.
Not so with Dogecoin. Since the token supply is high and the price is low, it’s not attractive to investors looking to hold onto their currency. The result is a highly liquid, free-flowing peer-to-peer digital currency.
What can you do with Dogecoin?
A key use of Dogecoin is as an online tipping system. If you like what someone posted in the Dogecoin Reddit community, throw them some Dogecoin. It’s part of what gives the community its friendly reputation.
You can also trade it for other cryptocurrencies on several exchanges, which has made the currency an unlikely medium by which people hop from one exchange to another.
From meme coin to Elon Musk's favorite crypto
For something that started out as a joke, Dogecoin has established a legitimate reputation. The community's philanthropic endeavors quickly caught the attention of the media; Dogecoin fans sponsored NASCAR driver Josh Wise in 2014, funded the Jamaican bobsled team at the 2014 Winter Olympics, and later raised thousands for a Kenyan water charity.
Co-founder Jackson Palmer isn't a fan of how seriously people take Dogecoin; he left in 2015, after scammers fleeced the fun-loving members of the Dogecoin community. At the time, he said too many people were jumping in with a ‘get rich quick’ mentality, missing the token’s purpose.
When Dogecoin briefly hit a $2 billion market cap in January 2018, Palmer remained critical. He stated, “I think it says a lot about the state of the cryptocurrency space in general that a currency with a dog on it which hasn’t released a software update in over 2 years has a $1B+ market cap.”
Dogecoin picked up steam once again in 2020; partly thanks to the emergence of a new social media platform that traffics in memes. In July 2020, a viral TikTok challenge encouraged users of the app to invest in the cryptocurrency, briefly causing the price to soar—to the point where the official Dogecoin account had to weigh in, cautioning people to "Stay safe. Be smart."
At the same time, Dogecoin found a celebrity fan in billionaire Tesla CEO Elon Musk, who began tweeting about the cryptocurrency—though he later clarified that he was talking in jest. After one tweet in December 2020, the price of Dogecoin shot up by 17%, from $0.0039 to $0.0046.
Other meme coins
Perhaps inevitably, Dogecoin's success has inspired imitators. Other so-called "meme coins" have sprung up, including SafeMoon (SAFEMOON), Shiba Inu Coin (SHIB) and Baby Doge (BABYDOGE), the latter of which was (possibly inadvertently) boosted by a tweet from Elon Musk. And those are just the headliners; the meme coin pack is buoyed by the likes of Doge Cash, Akita Inu, Dogelon Mars, Baby Doge Cash (which can be considered a spin-off of a spin-off) and even Floki Inu (named after Musk's pet Shiba Inu), all fuelled by an ecosystem of influencers.
While Dogecoin's devs are knuckling down to the long-term goal of turning the meme coin into a fully-functioning everyday currency, many latterday meme coins are open about the fact that they're taking a more trial-and-error approach; in SHIB's case, it bills itself as "an experiment in decentralized spontaneous community building."
Others don't see the funny side; in June 2020, Thailand's Securities and Exchange Commission ordered crypto exchanges to delist meme coins (alongside NFTs and social tokens), defining them as tokens that have “no clear objective or substance or underlying [value],” and whose price relies on social media trends.
Whether Dogecoin itself is here to stay—or whether it's destined to flame out as it did after its 2018 peak—is open to debate. But, as the Dogecoin community says, in the end one thing is immutable: 1 DOGE = 1 DOGE.
Throughout its lifespan, the Dogecoin community has remained active and loyal. If Elon Musk's goal of turning Dogecoin into a bona fide (or 'bona fido', perhaps?) currency for transacting in, it could very well stick around long into the future. Wow.