Cryptocurrency #12: Dogecoin - From a joke to a billion dollar bill

From the fun project of a programmer, Dogecoin has become a coding currency worth up to $ 2 billion.

Until now, after Dogecoin has racked up dozens of times and has reached a combined value of $ 2 billion, it's still a joke with Jackson Palmer, the creator of this digital coin. . Even Palmer and Billy Markus, the creators of the first Dogecoin, did not own any money.

It all starts with a joke

Jackson Palmer actually joked about posting a tweet in late 2013. It was a time when pre-coding became a feat when a bitcoin price just surpassed $ 1,000 and began to go down. At the same time, the doge of the dog, Shiba Inu, and the wrong expressions are also scanning the forums.

Palmer gave the idea of ​​combining a coded currency with the Doge image.

Palmer combined the two elements in his humorous tweet: "I'm investing in Dogecoin, it's going to be a blockbuster."

That joke attracted the attention of so many people, making Palmer decide to continue his joke. He bought the domain dogecoin.com , and made a photo with a "doge" on a coin. On this site, Palmer writes: If you want to make Dogecoin come true, contact me.

This message came to the person reading it, Billy Markus, an IBM engineer.

Markus has just completed an individual project he made in his spare time. Then Markus read the message on Dogecoin.com and retract the decision.

Take a noon to create Dogecoin

At first, Palmer did not respond to Markus's suggestion to create Dogecoin, so Markus decided to go ahead.

"It took me about 3 hours to turn Dogecoin from a fun idea into reality. It is really hard to make a new coding currency. "

Markus admits there are many passages in bitcoin's source code that he does not understand what to do. The most basic job is to search for "Bitcoin", and replace it with "Dogecoin". However, Markus changed some of the code in the code to fit Dogecoin: the limit of 100 billion Dogecoin instead of only 21 million, like Bitcoin. He also edited the font, changing the words "dig" (mine) into "dig".

And just in the afternoon, Markus created Dogecoin.

In the pre-coding world, there is a term called premining. That is when the founders "dig" the money before announcing their money widely. Almost every currency that is created seriously has this process.

Markus and Palmer did not, as they were not serious about releasing Dogecoin. Palmer did not even understand the concept of "digging" pre-coding.

"At the time we thought this was a joke and would be forgotten soon," Palmer said.

Markus, with his gaming computer, became the first to dig Dogecoin. But due to the difficulty of increasing the difficulty level, only after about 5 minutes this computer is no longer strong enough to dig money. All of the digs were digging before, Markus split in half for Palmer. At current prices, each owner of Dogecoin is valued at $ 5,000.

Since then, they did not own a Dogecoin anymore.

Develop like storm

Dogecoin is famous fast. There are a lot of rumors about this currency, with Reddit having the biggest role in promoting Dogecoin. The article on Dogecoin is constantly being expanded, along with accompanying services such as mines (many of which have one block and receive rewards after completion).

"Everything happens at the speed of light. After a few minutes, we told each other that this was completely out of control, "Markus told the Times.

But the factor that made Dogecoin turn up is the donation bot on Reddit. If someone comments like "this dogebot, please give this 5 dogecoin to me", that person will immediately receive 5 Dogecoin. Reddit users send Dogecoin to each other as a low cost exchange.

The Reddit community plays an important role in the rapid development of Dogecoin.

"I love it. At that time, Dogecoin is not worth anything, but getting 5 Dogecoin is still more fun than getting a real 2 cents, "Markus said.

Thanks to constant sharing and exchanges on Reddit, the number of users and dogecoin ownership has increased dramatically, and its value has also increased.

"At that time, almost everyone using Reddit had Dogecoin. I think that is the key to its success, "Palmer said.

Markus said he and Palmer were allergic to the word "investment". Both have supported their Dogecoin for charity. They helped dig wells in Kenya, raising money to train dogs as friends with autistic children.

Deviation and abandonment of the founders

But then as Dogecoin grows, the further away from the thinking of the founders. More and more people are interested in the value of Dogecoin, and invest in it literally. This made Markus startled.

"If you take 10 dollars to buy Dogecoin is not okay. It's like buying a movie ticket, just for fun. But when they spend $ 20,000 to buy Dogecoin? At the time, I was really upset. "

He started arguing with members of the community. With Markus, Dogecoin is still just a codepage "for idiots," but in fact it has become a kind of investment asset with many people. Markus wants to keep the absurdity of Dogecoin, but most of the community does not think so.

That was when Markus decided to give up.

"At that time I thought, okay, this is ridiculous. I do not want to run a cult. "

Collapse by Moolah

Moolah is a Dogecoin trading platform run by a self-proclaimed Alex Green. Palmer called it "PayPal for pre-encoding", and Moolah's actions made Palmer suspect from the start. Alex Green conquered the community by sending Dogecoin to anyone who supported him on Reddit.

Markus, now no longer playing the main role, has spoken out about this company. However, the Dogecoin community is very supportive of Moolah, simply because everyone likes to have gifts of money without any effort. Soon, Moolah began recruiting important members of the Dogecoin community to positions in the company.

After building trust, the company called for capital from the Dogecoin community itself. After three rounds of fund-raising with the promise of owning a portion of Moolah, Alex Green has received nearly $ 500,000 in investment and plans to acquire Mintpal's pre-emptive digital money platform.

Only five months later, Moolah said he spent all his money invested, could not earn revenue, and declared bankruptcy.

Moolah's investors have lost their money. Alex Green, also known by his real name Ryan Kennedy, is also involved in a series of scams with similar scripts, even being charged with rape. Kennedy is currently serving a prison sentence of 11 years in the UK.

What does the founder of Dogecoin say about coding money?

Just a few months after Moolah declared bankruptcy, Palmer gradually withdrew from the Dogecoin community and then abandoned.

After the Moolah incident, Dogecoin did not really collapse as many feared. The price of each currency is still close to $ 0.002 during the period from late 2014. However, by the end of 2017, Dogecoin prices skyrocketed and total value reached over $ 2 billion on Jan. 7. By this time, the total value of Dogecoin fell to about $ 700 million.

Dogecoin is still holding high value, but its creators do not believe in the future of coding.

Palmer also reappeared. In addition to his work at Adobe, he also has a pre-encoded YouTube channel. Palmer considered himself a digital money suspect.

"Money coding does not solve the problem. If so, it's just a tool for people to remember that we can not be serious with coding money. I want people to look back on Dogecoin and remember that a dog with a dog symbol is worth half a billion dollars. "

When Dogecoin's value reached $ 2 billion, Palmer continued to speak out about the pre-coding fever.

"There is a famous saying in the financial market: when a taxi driver advises you to buy a stock, it is time to sell. That means that when a person has no experience of the stock market can give advice, that is when the market has become so popular compared to its ability.

After 2 years out of the pre-encoding market, a Uber driver talked to me about Ethereum in early 2017, and then I realized we were in a digital money bubble. "

Palmer also pointed to the pre-emptive stock market movement, or ICO, which is becoming a trend in 2017 that has many of the same traits as the early Dogecoin scams. There are cases like PlexCoin calling for up to $ 15 million before the founder's assets are frozen and he is taken prisoner.

The most well-known encoded Bitcoin is not convincing Palmer, as there are still limits on technology, and now investors are almost exclusively interested in its price, not the items. original target of Bitcoin. And despite market optimism, he says 2017 is the worst year of codecs, as they are no longer technologically advanced but have become a new stock market.

The last question that Palmer himself did not answer was: When this bubble burst, did the community have the motivation and energy to create a really advanced technology?