General Studies- III (Awareness in the fields of IT)
Gist of Editorials
17 April 2021
Just as the virtual currencies Bitcoin and Ethereum have surged in value this week, so has Dogecoin– a cryptocurrency started in 2013 as an internet parody.
Based on the “Doge” meme and started as a “fun” alternative to Bitcoin, Dogecoin’s value has risen phenomenally– and now valued at $34 billion, according to CoinGecko, a market data site.
What is Dogecoin?
According to CNBC, the digital token was created in 2013 by software engineers Billy Markus and Jackson Palmer as a faster but “fun” alternative to Bitcoin.
- It was started as a satire on the numerous fraud crypto coins that had sprung up at the time, and takes its name and logo from a Shiba Inu meme that was viral several years ago.
- Unlike Bitcoins, whose maximum possible number is fixed at 21 million (a figure that is estimated to be reached by 2040), Dogecoin numbers do not have an upper limit, and there are already more than 100 billion in existence.
Concerns:
Some investors have expressed fears that Dogecoin’s rise would lead to a bubble, given that buyers do not see any meaningful value in the digital token, and are only trading to make money while the price keeps going up.
- Without having any intrinsic value such as land or gold, cryptocurrencies are considered highly volatile, and may crash as fast as they can rise.
- Experts say, making them susceptible to sudden scares as well as manipulation by small groups who often hold large numbers of the virtual currency in circulation.
What Is Cryptocurrency?
A cryptocurrency is a digital or virtual currency that is secured by cryptography, which makes it nearly impossible to counterfeit or double-spend.
- Many cryptocurrencies are decentralized networks based on blockchain technology—a distributed ledger enforced by a disparate network of computers.
- A defining feature of cryptocurrencies is that they are generally not issued by any central authority, rendering them theoretically immune to government interference or manipulation.
Source: Economic Times
