DOGE (Dogecoin) is a popular cryptocurrency. You can use it in the same manner as before, and it is still encrypted using blockchain technology to keep it secure. However, there is one significant distinction that many people overlook. Most currencies are capped to prevent inflation, having a restricted quantity that does not rise above a certain threshold, it has no such restriction and can continue to rise indefinitely with no end in sight to supply. This means that if no one ever spends any money, inflation will continue indefinitely. It is now worth roughly $7 billion, representing a 2,400% gain in value. In this post, we will look at the pros and cons of DOGE.
- Cheap transaction fees: Dogecoin does not have low transaction fees. The charge for transmitting DOGE from one user to another is often around 2%, which is significantly greater than the transaction size.
- Inflation control: It has a block reward scheme to restrict the number of new coins issued each year. This means that when more individuals use and exchange Dogecoin, its value rises.
- Effortless to send: Because there are no transaction fees, sending DOGE between users is simple (unlike Bitcoin).
- Availability: It is available on more exchanges than most other cryptocurrencies. This means that there is a constant supply and demand, which can help to increase the coin’s value.
- Name recognition: Because of its name recognition, many individuals use and transact with it, implying that DOGE can be a successful cryptocurrency for those new to the crypto industry.
- Beginner-friendly: While many people use DOGE due to its brand familiarity, it also offers characteristics that make it more user-friendly than other cryptocurrencies such as Bitcoin or Ethereum (for example, there are no transaction fees).
- Shortage of exchanges: Because Exchanges do not widely accept Dogecoin, users must utilize an exchange such as Poloniex or Shapeshift.io to exchange their DOGE for other cryptocurrencies or USD. This signifies that the coin has a lack of liquidity on most trading platforms.
- Limited trading volume: Because most exchanges have a low amount of DOGE deals, the market is weak, and the coin’s price fluctuates more than it would on a more extensive exchanges.
- Delayed transactions: Transactions involving DOGE typically take a long time since they are congested. This is because most exchanges do not offer coins, and there is insufficient liquidity to handle vast trading volumes.
- Short block time: It has a one-minute block time. Because of the short block time, miners may execute many transactions in a single day (and therefore increase their profits).
- Inflation: The system generates 100,000,000 new coins per year. Miners can then sell their currencies to investors in exchange for cash or products and services. As new coins are added to the market each year, the DOGE system experiences significant inflation (and therefore decreases the value of existing coins).
- No value: The DOGE coin has no value beyond its network and hence cannot be used to purchase products or services in other marketplaces, making it useless outside of its community.
Should I Buy DOGE?
DOGE is an unprecedented situation because it has a deliberately low barrier to entry. Because there is so much of it, it is frequently priced at less than $0.5 per coin. Thus even a casual observer could afford at least ten coins. Inflation is rampant, yet the community is vast since the worth of each coin is essentially nothing. While DOGE will not rise in value in the same way that Bitcoin or Ethereum will, the price of Dogecoin ensures that you can’t indeed lose money by purchasing it.
It is a terrific, safe entry point for new investors and a location where existing investors can deposit their spare change for fun, and it can even be spent in a surprising number of places.
Is DOGE risky?
Small amounts of Dogecoin are primarily innocuous, and if you’re lucky, you might even make a profit. However, it is not a currency in which you should invest hundreds of dollars. Moreover, even if it does rise, it is practically a joke currency, which means you can’t forecast how it will alter.