In 2008, Japanese kindergarten teacher Atsuko Sato acquired Kabosu, a female Shiba Inu dog, and saved her from imminent death after the puppy factory where she was housed had to close. A couple of the pedigreed dogs were adopted, but the rest had to be euthanized.
When she first started sharing images of the dog on the internet, she had no idea that the dog would become immensely famous thanks to the memes that arose as a tribute to these bright breeds with strong personalities.
Shibas are a primordial breed that date back to the third century BCE, making them an extremely unusual and sought-after sort of dog. Before becoming famous, Sato started a blog to raise awareness about the hazards of puppy mills and adopted dogs, which swiftly gained a large following and quickly became one of Japan’s most popular blogs.
The path to global fame was set, and soon Reddit and Tumblr Shiba Confessions gave the world’s most famous and photogenic dog the ultimate recognition, depicting it in various humorous caricatures that were quickly used by advertisements and gadgets and consecrated by the creation of the DOGE cryptocurrency in 2013.
The history of Shiba Inus and Dogecoin
Doge was founded by two IT professionals who were also skilled engineers. They did not abandon technological innovation and really created good software. They used a robust, efficient, and secure blockchain, proof-of-work (PoW) mechanisms, and mining operations.
However, the early days of Dogecoin were quite spectacular. On December 25, 2013, just a few days after the introduction, multiple Dogecoin wallets were hacked, resulting in the loss of an estimated 21 million coins. The DOGE cryptocurrency community banded together to generate funds and compensate affected users.
This was a watershed moment for the DOGE cryptocurrency, which began to be viewed as a charitable and tipping instrument in the years that followed. While distinguishing itself for its helpful attributes, Dogecoin distanced itself from the unfavorable perception of other altcoins that were associated with a get-rich-quick plan.
Dogecoin suffered a huge setback in 2015 when Jackson Palmer and Billy Markus chose to abandon the project due to their dissatisfaction with the crypto industry’s opportunistic and poisonous state.
For most of 2015 and into 2017, the coin vanished. Nonetheless, it resurfaced during the 2017 bull market, reaching an all-time high of $0.0188 in January 2018, much to the surprise of its developers, who believed it was pretty strange that a dog-themed coin that hadn’t received a software update in about two years was enjoying such success.
Technical and fundamental features
Dogecoin is a blockchain-based, peer-to-peer (P2P), open-source, decentralised, and anonymous cryptocurrency. It is derived indirectly from Bitcoin because it forked from LuckyCoin, a fork of Litecoin that uses the same codebase as Bitcoin.
The Litecoin script algorithm was adopted by the designers, which allows for faster and safer transactions because of the reduced hash rate (the measure of processing power per second) necessary to function. This encouraged early adopters to use Dogecoin as a mode of payment for small transactions, such as tipping.
It is mined using an auxiliary proof-of-work mechanism (AuxPoW), which differs from PoW in that it may be mined alongside other cryptocurrencies that use the scrypt algorithm.
Because it does not require specialised mining equipment like the application-specific integrated circuits, or ASICs, used in Bitcoin, Scrypt is easier to use than SHA-256, the cryptographic hash or signature needed to verify the authenticity of a file or text. Instead, both Litecoin and Dogecoin can be mined using simpler devices like Central Processing Units (CPUs) or Graphic Processing Units (GPUs), which were previously used to mine Bitcoin. Dogecoin mining is now accessible to the average user who wants to join the network as a miner, thanks to relatively affordable equipment. Scrypt’s key derivation process is slow and memory-intensive, making it difficult for engineers to develop specialised hardware, such as ASICs, to mine the coin.
Because Litecoin and Dogecoin use the same hashing algorithm, it is possible to mine both cryptocurrencies concurrently in a process known as “merged mining” which helps secure the network, allows miners to receive a higher reward from two streams of revenue, and reduces the mining process’s energy consumption.
Dogecoin blocks are 1 MB in size, just like Bitcoin blocks. However, due to its Scrypt nature, which allows for faster and cheaper transactions, Dogecoin’s blocks are produced every minute as opposed to Bitcoin’s 10-minute interval, allowing it to handle a higher number of transactions per second.
To dissuade miners from competing with enormous amounts of hash rate, Dogecoin block rewards were initially designed to deliver a random number of coins ranging from zero to one million.
This mechanism was in use until the quantity reached 100 billion coins in circulation in mid-2015. Since then, the structure has been changed to provide an uncapped supply while restricting the reward to 10,000 doge-coins every block to control Dogecoin’s inflationary system, allowing the price to remain more stable over time. A less volatile currency would certainly appeal to long-term investors who prefer not to assume exponential risks.
The future of Dogecoin
The network effect ultimately determines whether and when new technologies enter the mainstream, as it has with the telephone, the Internet, and other advancements in the past.
While the cryptocurrency business continues to grow, there is no doubt that Dogecoin remains enticing to both small and large investors, thanks to its prestige and popularity on social media and among celebrities.
One of the most common accusations leveled at Dogecoin in the crypto world, and even mentioned by Elon Musk, is the significant concentration of coins in the hands of a few large investors. It is claimed that over 50% of Dogecoin’s total circulating supply is owned by only about 20 Dogecoin wallet addresses, which could be problematic if any of these large investors decide to sell their assets all at once, producing a massive price shock.
Elon Musk tweeted a graphic of a Dogecoin standard taking over the global financial system in July 2020. It remains to be seen whether this was a forecast, wishful thinking, or simply a happy and harmless meme.