Buy Dogecoin in 2022- Advantages and Disadvantages
Due to its amusing character, Dogecoin has been the buzz of the community since its creation.
Dogecoin, often known as DOGE, is one of the most profitable cryptocurrencies on the market. Billy Marker and Jackson Palmer started it in 2013. It was made as a joke from a meme featuring the Japanese dog breed Shiba Inu, therefore its creation was amusing. DOGE grew in popularity over time, and real-value crypto traders began to consider it as a long-term investment. It has a market cap of US$23.37 billion and is the 11th largest cryptocurrency in the market, according to coinmarketcap. The mass appeal of this meme-inspired and sometimes humorous cryptocurrency is what drives its success. DOGE appears to be less frightening and more approachable than the thousands of other cryptocurrencies and tokens. Dogecoin is a popular speculative cryptocurrency that has recently gained popularity.
However, in recent years, these headlines have resulted in outperformance. It’s still unclear what will happen to Dogecoin’s value in 2022. So, we’ve compiled a list of 5 Dogecoin advantages and disadvantages so that readers can evaluate their DOGE investing strategy.
One of the most significant advantages of dogecoin is that it has a rapidly developing community of holders and advocates. Its growing community of users, according to Cuban and Mark, makes it an ideal medium for exchange. One of the main reasons for its growing popularity among the general public is that its investors regard it as an absolute value. As part of the crypto’s advertising, these investors are also quite active on social media platforms, sharing memes based on the cryptocurrency.
DOGE is compatible with decentralized exchanges and may be traded and transacted on them. The Ren project, in particular, has given it access to the Ethereum blockchain platform as well as the decentralized finance network. This shows that DOGE is consistent with the crypto market’s burgeoning decentralized finance movement.
Easy transaction: Dogecoin is similar to Bitcoin in numerous ways, which means it offers some of the same benefits. The crypto’s coding is also quite similar to Bitcoin’s, making it more safe and convenient to use. Dogecoin also has no mining restrictions. This gives investors the ability to trade Dogecoin at any time, whether it’s for a short-term or long-term investment.
DOGE’s first public offering (IPO): Dogecoin has been listed on some of the greatest stock and cryptocurrency trading platforms since its beginnings, including eToro, one of the largest multinational crypto brokerages. Its inclusion on eToro has resulted in a significant surge in client interest for Dogecoin trading. Clients looking to trade DOGE have also increased their traffic as a result of the platform.
DOGE’s unique market positioning: Several investors view DOGE’s inflationary state, unique mining feature, and ties to Litecoin to be unique. Dogecoin’s mining methodology is based on proof-of-work, which means significant computational tasks must be solved to confirm transactions throughout the blockchain because it was an early crypto entrant.
Lacks supply capitalization: One of Dogecoin’s main drawbacks is the lack of a supply cap. It’s because cryptocurrencies with no supply limit are ineffective inflation hedges. Furthermore, DOGE’s limitless mining will necessitate larger blockchain mining operations in the future. Because it uses the proof-of-work process, it will continue to grow its pool of miners and the number of computers it uses to handle the ever-increasing volume of transactions.
Its lighthearted character may be incompatible with true innovation: DOGE was created as a parody of current coinage such as Bitcoin and Litecoin. DOGE’s nature prevents it from being integrated and adopted as a digital asset.
Poor technical assistance: Despite its increasing network of users and supporters, Dogecoin has poor technical support. DOGE has a smaller development staff than Bitcoin, Ethereum, and Cardano. DOGE has also made no technological advancements or adjustments since 2015. It’s also worth mentioning that in terms of technology, it doesn’t offer any unique selling propositions.
Association with pump-and-dump schemes: Pump-and-dump schemes have been around for quite a while. Despite the fact that it is forbidden on regulated crypto exchanges, it nevertheless has an impact on some cryptos. Pumping occurs when a significant number of coins are purchased by a group of people, causing the asset’s price to skyrocket. When the coin’s value rises over what it was purchased for, they sell the assets to other investors and profit handsomely. This type of deception is extremely common with DOGE
It isn’t the best medium of exchange: Dogecoin can only be used as a digital currency, unlike other currencies like as Tronic and Ether, which may be used as transactional currencies. Cryptocurrencies such as Bitcoin, Litecoin, Dash, and Bitcoin Cash have a higher transactional value than DOGE.
DOGE brought crypto millionaires and billionaires to a technological future they had no idea existed. Investors should always test the waters before trading on currencies like Dogecoin, despite its achievements.