Beginner’s guide to buying and storing Dogecoin

The authors, TM Lee and Bobby Ong, are the founders of CoinGecko, a site that ranks the potential of altcoin.

Bitcoin is a decentralized digital payment system that has seen a lot of interest lately. It’s an open-source project in which the source code is available on Github for developers to view and modify.  Because it is very easy for developers to fork Bitcoin’s code or to copy the blockchain idea underlying Bitcoin, there are now over 490 cryptocurrencies in the market.

Dogecoin is one such example of a fork where its creation was actually started out as a joke. Dogecoin, based on the shiba inu Internet meme, is a cryptocurrency that has been consistently ranked as the coin with the second most active community after Bitcoin on CoinGecko.

Dogecoin started when Jackson Palmer serendipitously tweeted, “Investing in Dogecoin, pretty sure it’s the next big thing.” After receiving encouraging replies, he bought the domain Dogecoin.com. It was not long before Billy Markus stumbled on this and started manipulating Litecoin’s source code to create Dogecoin. Eventually, a partnership came to life along with Dogecoin when it was released on the Bitcointalk forum on December 6, 2013 as a satire in a thread titled “Dogecoin – very currency – many coin – wow – v1.1 Released”.

Dogecoin has come a long way since its launch by conducting many advertising and donation drives such as sponsoring a Nascar and sending the Jamaican bobsled team to the Sochi Winter Olympics. Recently there were serious concerns about Dogecoin’s hash rate decreasing to low levels, making it possible to launch a 51 percent network attack on the system and destroying the coin. So, a decision was made in August to allow Dogecoin to be merge-minable with Litecoin to secure the future of Dogecoin.

What can you do with dogecoin?

One of the great advantages of using dogecoin or other cryptocurrencies is that it is now possible to conduct online microtransactions (such as making US$0.01-US$0.50 transactions) which was previously not possible with credit cards. This is made possible as cryptocurrencies generally have low or zero transaction fee (zero fee is applicable for off-blockchain transactions).

The general idea behind microtransactions is this: you can charge a really low price for a particular service, and your customer should have no problem in deciding to make a purchase because of the negligible price. This opens up many interesting business models previously unavailable. Bitwall is one such service provider where content such as this article can be put behind a paywall and only made available after a small fee is made in cryptocurrencies.

Also, while you can tip pennies to a street performer, it has been impossible to do so online. Take for example a content producer on Youtube. With microtransactions, it is possible for an indie videographer to be compensated for producing a video just like how a street performer can receive pennies from people. Even though the amount contributed by each person might not be a lot, this may eventually add up to a decent amount by the end of the month. With microtransactions, it is possible to reward and show support to individuals that make your life better. This opens up a new revenue model for content creators who may previously only have AdSense as the sole source of income.

The same can be said for Facebook and Twitter status updates. People who make interesting and thoughtful comments can receive rewards via the various tipping bots such as Dogetipbot and Backslash. This introduces a new paradigm to social media use instead of simply liking and retweeting statuses.

Getting started with dogecoin using an online wallet

The simplest way to get started with Dogecoin is to use a client-side online wallet such as Dogechain.info. To begin, click on the Wallet link on the homepage of Dogechain.info.