|Analysis: Crypto again had a relatively flat week, with spot volumes well below averages we saw in May and June. Altcoins continued to see the most momentum with XLM up over 5% on the week, and Dogecoin showing ups and downs.
Big Story Of The Week: Dogecoin
Dogecoin, An Obscure Cryptocurrency With A Unique Culture And Community, Has Saw A Rally Of About 85% Since The Beginning Of July, followed by a 40% drop. What’s DOGE all about?
- Dogecoin (DOGE), is one of the better representations of crypto’s perceived otherworldliness. Dogecoin was created by Billy Markus from Portland, Oregon in 2013 ‘without much real thought.’ Markus created the coin as a satire of the early alt-coins of the period. Markus has since then moved on from the project and is no longer involved. Dogecoin was hard forked from Luckycoin, a Litecoin hard fork. Unlike Litecoin, DOGE’s supply is unlimited and it is easily minable with basic hardware. As a result, Dogecoin has a rather strong distribution of nodes geographically, with the US and Germany accounting for about 50%, of the total of 420 active nodes. The coin also has an active developer community. For example, in 2018, developers released a Dogecoin – Ethereum bridge, allowing for DOGE to be moved to Ethereum and deployed in that ecosystem. The symbol of the coin is the Shiba Inu dog. This symbol stems from Dogecoin’s early days, when it used memes featuring the dog to promote the currency and satire other alt-coins. For this reason, Dogecoin has often been referred to as a ‘meme currency.’ The coin’s active ecosystem also features several block explorers and a Dogecoin Foundation. Dogecoin is also known for above its weight-class marketing, like raising $55,000 to sponsor a Nascar driver or $25,000 to send the Jamaican bobsled team to the Olympics. The coin has been seeing renewed interest in this latest rally. Unfortunately, Bitbuy has no plans to launch Dogecoin at this time but you can easily get your hands on some DOGE by sending BTC from your Bitbuy account to an exchange that offers a BTC/DOGE pair such as Binance.
Takeaway: Dogecoin does not make it easy for one to take it seriously. However, the asset’s continued perseverance speaks to the broader nature of the crypto space. Firstly, DOGE’s rallies, often attributed to viral content – i.e. its original memes and this latest rally’s suggested connection to TikTok videos – show crypto’s attractiveness to a new cohort of investors whose investment decisions will be impacted by new and emerging information/news sources. Secondly, Dogecoin’s most immediate creators, Billy Markus and Jackson Palmer, are not involved. Along with low barriers of entry to mine Dogecoin using regular CPUs, the network shows signs of authentic decentralization. While the fundamental case for DOGE is far from being well-established it is disproportionately known by younger generations in social media channels. Whether interest remains as this demographic gets older and grows spending power will be an important question for the future of DOGE.
Other Weekly Headlines
- Yesterday, there was a large scale scale Twitter hack where several high level crypto and non-crypto users were tweeting out Bitcoin addresses in an attempt to defraud followers. Binance, Coinbase, KuCoin, and several others in the crypto space, along with Bill Gates, Elon Musk, Joe Biden and Barack Obama and others had their accounts compromised. Although Bitcoin was only used as the currency in the scam, the mainstream media took notice, and it’s a bad look for the industry often fraught with reputation issues. Twitter says the investigation is ongoing. FULL STORY ON BBC
- During a Friday ask-me-anything session on Reddit, Justin Drake, an Ethereum Foundation researcher, said Ethereum 2.0’s first phase won’t begin until Q1 2021. Drake cited the need to run a public testnet successfully 2-3 months as impacting his prediction. After the event Drake tweeted ‘[t]he community wants phase 0 genesis in 2020—not one day late. The goal is set; let’s ship.’ FULL AMA ON REDDIT
- Electrum, a bitcoin wallet, has released its latest version, launching upgrades that include Lightning Network support. Electrum founder Thomas Voegtlin: ‘Lightning is quite complicated and not without its issues but ultimately it is the most promising currently known way of scaling Bitcoin.’ FULL STORY ON COINDESK
- According to documents obtained by crypto news site The Block, Coinbase is providing blockchain analytics services to the US Secret Service. The exchange was awarded a contract, worth $180K, that lasts until 2024 for the service. CEO Bryan Armstrong defended the contract via Twitter after receiving criticism. FULL STORY ON THE BLOCK