DOGE is a community-driven meme cryptocurrency that, like Bitcoin, is used as a medium of exchange of value. Dogecoin is primarily used as a tipping system on Reddit and Twitter to reward people who create or share high-quality content. There is no cap on dogecoin supply, with inflation of 5 billion DOGE per year, or about 13% of its circulating supply. Nasdaq estimates that its inflation rate will fall to 2.4% by 2040, similar to the dollar's current rate, and will continue to decline over time.
Unlike Bitcoin's Proof of Work algorithm, Dogecoin uses the same Scrypt technology as Litecoin. Miners can complete and record transactions faster and more easily, making dogecoin more efficient in processing payments. The process of creating a new block on Bitcoin takes 10 minutes, compared with one minute for Dogecoin. Dogecoin miners can mine digital currency using gpus, and from 2014, Litecoin will be mined alongside Dogecoin.
Dogecoin's creators have pitched it as a fun, light-hearted cryptocurrency that makes dogecoin even more appealing outside bitcoin's core audience because it's based on dog memes. That has caught the attention of tesla's chief executive, Elon Musk, Mark Cuban and Gene Simmons, among others. Causing meme coins to spike after tweets of praise from these celebrities, especially Musk.
Dogecoin started with Meme, but has since become a relatively successful cryptocurrency and is now accepted and used by more than 1,600 merchants around the world, including the NBA team Dallas Mavericks.