Cryptocurrency has become one of the most reliable trading sources in the past years. The acceptability of this currency has become so huge that people prefer this type of currency other all other currencies. Cryptocurrency has many kinds, and people use different kinds of this currency for their trading. The most used currency in the past decade is Bitcoin, and after some time, another currency was launched named dogecoin. In this context, we will see the comparison of dogecoin vs. bitcoin. Here we will see some similarities as well as differences.
To understand the similarities and differences between these two coins, you must have the proper knowledge about them. For that purpose, the basics of these two coins are necessary for anyone who wants to make the comparison. So, let’s see some basics of these two tending cryptocurrencies.
Basics of Dogecoin vs. Bitcoin
As mentioned above, these two coins have much for comparison, and you must know how these coins work. So, please keep your eyes open and let’s start to see which coin is better than the other in terms of trading.
What is Bitcoin?
In January 2009, the decentralized digital currency, Bitcoin, was initially presented. It is based on concepts offered by founder Satoshi Nakamoto, a mysterious and fictitious person. The person or individuals who invented the technique remain an enigma. Unlike all other online payment options, Bitcoin offers lower transaction costs as a decentralized authority manages it.
It is a decentralized digital currency that can be moved between peer-to-peer bitcoin network users. Network nodes validate cryptographic transactions, and the records of those verifications are stored in the blockchain, a decentralized public ledger system.
Advantages of Bitcoin:
As bitcoin is the oldest form of cryptocurrency, it has many advantages over all other forms. Liquidity and accessibility are the main advantages of bitcoin which are most significant. On the other hand, transparency and independence from central authority are also great benefits. Users can get a massive return by trading in bitcoin, as we can see from the spike in the Bitcoin price of this cryptocurrency.
Disadvantages of Bitcoin:
Volatility is the most significant problem many people face with bitcoin. Since the underlying value of Bitcoin may fluctuate by several percent every day, it is challenging for several businesses to accept it. Additionally, it is unregulated and has relatively restricted usage. Depending on the circumstance, this isn’t necessarily a good thing. Since Bitcoin is still a relatively new technology, only some people use it. The potential exists that Bitcoin might be replaced by central bank digital currencies very soon.
What is Dogecoin?
Palmer, the founder of dogecoin, combined the well-known “Doge” Shiba Inu meme with a cryptocurrency to create Dogecoin. Palmer first posted a somewhat joking tweet about his concept, and Markus, another founder, responded by offering to construct Dogecoin.
Before Palmer could answer, Markus created Dogecoin in three hours by forking Lucky Coin, a Bitcoin fork in and of itself. Markus took the source code from Bitcoin, Litecoin, and Lucky Coin and modified it before making the project public. Palmer and Markus anticipated that their meme effort would fizzle out soon after the debut of Dogecoin. As a result, DOGE developed a sizable community on the social media website known as Reddit.
Many supporters of DOGE sent DOGE back and forth, exchanged DOGE knowledge, and introduced new people to the DOGE community. Eventually, Elon Musk, the creator of Tesla, was involved in this. In early 2021, Musk claimed to launch DOGE to the moon in a series of tweets regarding the stock. Due to the surge in interest from investors following Elon Musk’s tweet, the price of DOGE shot up. Furthermore, it inspired a rush of DOGE-related memes, which increased awareness of this asset.
On Christmas Day in 2013, the Dogecoin network was unfortunately compromised. A third-party Dogecoin platform known as DogeWallet was hacked, and 11 million DOGE were stolen. Two days later, the Dogecoin community kindly donated 15 million DOGE to DogeWallet as compensation.
Some of the wealthiest investors take control of this dogecoin nowadays, which is also helpful in controlling the prices of dogecoin.
Advantages of Dogecoin:
In comparing Dogecoin vs. Bitcoin, Dogecoin’s speed is by far its most significant benefit. In that regard, Dogecoin is preferable to Bitcoin since the network’s transaction processing times are substantially faster. Massive amounts of Dogecoin may be purchased at a low price, but this is also a factor in the currency’s “meme effect”. As a result, Dogecoin has occasionally experienced substantial profits but has the potential for enormous losses.
Disadvantages of Dogecoin:
However, there is a speed price. The Dogecoin network is less secure than the Bitcoin network. In addition, there is no cap on the total number of Dogecoins that may be mined, making it, by definition, an inflationary coin. The currency is also susceptible to social media and was first created as a prank. One of the early “meme currencies” is called Dogecoin.
This implies that, occasionally, hype or a lack thereof might affect this coin’s value. However, that momentum may also be lost very fast. You must follow social media trends to be a successful Dogecoin trader. You should also be aware that Dogecoin seldom rallies when Bitcoin is experiencing difficulties.
Similarities of Dogecoin vs. Bitcoin
Reading thoroughly from the top, you might notice that dogecoin is made from bitcoin. So that is why these two coins have so many similarities, which makes the user need clarification about choosing the perfect between the two. Some similarities between these coins are as follows:
Both networks use work-of-proof techniques for their mining operations. Complicated mathematical equations must be solved to “mine blocks.” The Dogecoin network is faster and less safe than the slower and more secure Bitcoin network. The Bitcoin network’s energy consumption is one of the main criticisms of the currency.
One of the most desired results at this stage for these “POW” networks is utilizing less energy. They need to catch up with solid evidence platforms like Ethereum, even though their efficiency has improved. This is a persistent issue for these networks, although it is currently being addressed.
This is the best way of earning more coins with a proof-of-stake network. Mining the coins is the best way to get more cash in BTC and DOGE. This BTC process is more secure but much slower than DOGE, although the whole network of this cryptocurrency is much improved.
Dogecoin vs. Bitcoin Comparison:
|Founding Date||Was Founded in 2013||Was Founded in 2009|
|Initial Purpose||As a Parody of Bitcoin||Form of cash or wealth|
|Market Capital||$17.03 billion||$388 billion|
|Max Available Supply||Unlimited (approx.. 5 billion annually)||21 Million|
|Usage||Digital payment to purchase several items.||Digital payment for payment of services or as a currency.|
|Influence the Value||Hype from Social Media||Demand and Supply|
|Working||Proof-of-work Protocol using scrypt algorithm.||SHA-256 hash algorithm with digital wallets and blockchain.|
|Security||Less Secure than Bitcoin.||More secure than any other cryptocurrency.|
|Transactions Per Second||33 transactions||7 to 10 transactions|
|Transaction fee||US$0.24 per transaction.||US$1.54 per transaction|
|Block Reward||6.25 BTC per block as of May 2022.||10000 DOGE per block|
Dogecoin vs. Bitcoin Which one is Better for Trading?
If you are still finding the best coin for trading, bitcoin is by far the best for this purpose. As we know, a considerable amount of institutional money is invested in Bitcoin today, which is a significant reason. Due to this enormous investment, the market of BTC is stable much more than any other coin. The next thing to consider is BTC’s adoption or acceptance, which leaves Dogecoin far behind. This direct effect on the usage of BTC in numerous places is known as the network effect.
The truth is that many people currently believe in Bitcoin, as we know that the Dogecoin market was created as a joke. Memes and social media buzz drive it instead of underlying principles or values. The one where you ought to put most of your trading money has no comparison.
As a result, the essential thing to note is that the difference between these two cryptocurrencies is enormous. Big players and investors created Bitcoin to build as an asset. On the other hand, dogecoin was created just for fun which runs on hype. So, for these reasons, a person looking to invest money must use the BTC platform to get more secure and valuable profit. Dogecoin is much riskier, and you might lose a lot of it. However, in the end, you decide to use any cryptocurrency for your trading, whether BTC or DOGE, but always do it with an expert’s view.