In the summer of 2014, I met dogecoin co-founder Jackson Palmer in San Francisco during a tech conference.
Jackson was instantly likeable, and we happened to know some of the same people at the conference. We hung out that night, and he gave me some insight into the project. I was already a fan of the coin. I even tweeted about it back in late 2014.
What drew me to dogecoin was the jokes and lightheartedness of it all. It had a very different vibe than bitcoin (BTC), which seemed stuffy by comparison.
But even back then, none of us took dogecoin seriously. Jackson didn’t even own any.
So it was strange to see Jackson featured in a Wall Street Journal piece in February 2021 titled “Dogecoin’s Founder Bewildered at Cryptocurrency’s Sudden Popularity.”
When that article was published, dogecoin was only trading at around $.08. Today it’s trading for more than $0.45, giving it a ridiculous market cap of $68 billion.
This Is Getting Ridiculous
I honestly couldn’t believe my eyes when I saw what Elon Musk tweeted yesterday: “Working with Doge devs to improve system transaction efficiency. Potentially promising.”
I think Elon is way out of his league here. He apparently didn’t even know how bitcoin worked until a week ago. Now he wants to make dogecoin more scalable than BTC?
What a preposterous idea. Dogecoin is not a real cryptocurrency. It’s a bitcoin clone that’s rarely updated and has known security vulnerabilities. It has no infrastructure and no advanced liquidity systems. Trying to make it competitive with bitcoin is a joke.
Adam Back — a bitcoin pioneer and the co-founder of influential bitcoin firm Blockstream — replied to Elon Musk and said as much.
So look, I love dogecoin. I think it was a really fun project. But it’s not a real bitcoin competitor at all.
Bitcoin has an incredible amount of infrastructure built up around it. Bitcoin has thousands of groups mining it and processing transactions around the world. It’s a network that’s decentralized and dependable. It has layer 2 scaling solutions like Liquid, which make it possible for such an incredible amount of transactions to take place. Bitcoin has hundreds, if not thousands, of developers and node operators that help maintain its security. It has unmatched liquidity around the world and can be traded for fiat cash almost anywhere.
Dogecoin doesn’t have any of that. Elon Musk is high on his own power to move markets and is acting more and more erratically. I don’t think this dogecoin nonsense will end well for most people. And frankly, it’s making crypto look bad.
Be careful out there folks. This is a dangerous market.