Bitcoin

Dogecoin vs Bitcoin • Investment Comparison • Benzinga

In a twisted turn of events, Dogecoin has become the 4th largest cryptocurrency by market cap, at a mere $75 billion. At the same time, Bitcoin’s market cap sits around $1 trillion. The meme coin has been chosen by the people, but does it have a chance at beating the giant?

Dogecoin originated as a joke to help teach people about the capabilities of blockchain in a fun, and meme-y way. Dogecoin’s creators, Billy Markus and Jackson Palmer, copy-pasted the Bitcoin source code, gave it a shiba inu logo and let the doge out. 

Dogecoin is an open source project that has been developed over the years and now has some legitimate technological differences from the Bitcoin code it began with. But, what are these differences, and do they really add value to the digital currency compared to Bitcoin?

What is Bitcoin?

Bitcoin was created by Satoshi Nakamoto in 2008, and launched in 2009. Satoshi Nakamoto is the pseudonym of a person still unknown to the world. Satoshi believed that a product such as Bitcoin could not have a public creator, as it would distract from the ethos of decentralization

Bitcoin’s decentralized ledger became the first real application of blockchain despite similar concepts existing within the crypto community since the 80s. Satoshi figured out that by requiring energy-intensive, hard computations a network could make spam uneconomical. This method, called proof of work (PoW), enabled those who were willing to pay a fee for access to the network to complete trustless, peer-to-peer transactions for Bitcoin. 

The fee was sent to the miners, a decentralized network of individuals running these hard computations for a cut of the rewards. PoW simultaneously erased spam, and gave random people across the world access to a form of passive income with their home computers. More and more people decided to add their computing power to Bitcoin’s network, which in return added value to Bitcoin itself. 

Bonus:

Many experts suspect that this network size to coin value relationship is modeled by Metcalfe’s Law.

What is Dogecoin?

This Bitcoin copycat was created amidst a wave of insanely overbought Bitcoin copycats. Billy Markus and Jackson Palmer did not intend on becoming overbought, they just wanted to meme on the other shitcoins. And that, they did. 

Markus explained in a Reddit rant that the project took around 3 hour to put together, and that he spent “the bulk of that time making alterations to the client to make the text Comic Sans”.

If that doesn’t convince you of the almost $75 billion dollar market cap of this project, check out Is Dogecoin a Good Investment to learn how it got there. 

Similarities and Differences

Since the early days of Dogecoin’s inception, it hasn’t seen a whole lot of major updates to its core software. While the framework is almost entirely the same as Bitcoin, there are a few notable changes. 

1st, Dogecoin processes blocks of transactions every 1 minute, compared to Bitcoin’s 10. This is intended to make the currency more transactional, as payments can process in around the same time as the block size. It also means that 10x the relative rewards are given out each minute to Dogecoin miners vs. Bitcoin miners, which lowers transaction fees for the users. From a purely transactional perspective, this is Dogecoin’s only real advantage over Bitcoin. 

2nd, Dogecoin’s supply has stopped halving. Unlike Bitcoin (whose supply halves every 210,000 blocks), Dogecoin’s supply stopped halving after the 600,000th block. Since then, the reward for Dogecoin miners has remained at 10,000 Dogecoin per block. Dogecoin will continue to inflate at this rate permanently, whereas Bitcoin will continue to halve its block reward until all 21 million Bitcoin have been mined (sometime around 2140). Economists and crypto enthusiasts alike continue to debate which inflation policy is optimal. Spoiler alert, it’s probably Bitcoin’s. 

3rd, the Dogecoin network is immensely less secure. Dogecoin’s network boasts a hashrate currently around 464 TH/s, whereas Bitcoin’s is a much more mature 176,000,000 TH/s. This means that a 51% attack on Dogecoin isn’t really that expensive. For an estimated $10 million, anyone who had the dough could take over the network and send the $75 billion market cap plummeting in seconds. 

Where to Buy Dogecoin

Dogecoin is available from Gemini starting May 4, but has been available on Robinhood, Kraken, Voyager and Changelly for some time. If you don’t already have an account with one of these centralized exchanges, you can get started with the link below. 

Just like Bitcoin, Dogecoin must be stored in a cryptocurrency wallet. Crypto wallets are often tricky for beginners, so here’s a basic rundown. 

Crypto wallets store the private key needed to open up your address on the blockchain. Just like how home addresses are publicly displayed above the door, but there is a separate key needed to actually get in, your Dogecoin balance is tied to your public wallet address only accessible via a private key. Keeping this private key safe is of the utmost importance. Losing a key with no backup means losing all your dogecoin along with it. 

To keep things simple, some exchanges store your private key for you. While this may seem like a benefit, it actually means that you don’t own (or even have access to) your own money. Additionally, this presents a centralized choke point for a high-value hack. If control of your funds is something you value, then it may be worthwhile to download or purchase a dedicated crypto wallet. Find out which one is right for you on Benzinga’s guide to the Best Crypto Wallets

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Intermediate Traders and Investors

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Webull, founded in 2017, is a mobile app-based brokerage that features commission-free stock and exchange-traded fund (ETF) trading. It’s regulated by the Securities and Exchange Commission (SEC) and the Financial Industry Regulatory Authority (FINRA).

Webull offers active traders technical indicators, economic calendars, ratings from research agencies, margin trading and short-selling. Webull’s trading platform is designed for intermediate and experienced traders, although beginning traders can also benefit.

Webull is widely considered one of the best Robinhood alternatives.

Best For
  • Active traders
  • Intermediate traders
  • Advanced traders
Pros
  • Commission-free trading in over 5,000 different stocks and ETFs
  • No account maintenance fees or software platform fees
  • No charges to open and maintain an account
  • Leverage of 4:1 on margin trades made the same day and leverage of 2:1 on trades held overnight
  • Intuitive trading platform with technical and fundamental analysis tools
Cons
  • Does not support trading in mutual funds, bonds or OTC stocks

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eToro, headquartered in Cyprus, England and Israel, has provided forex products and other CFD derivatives to retail clients since 2007. A major eToro plus is its social trading operations, including OpenBook, which allows new clients to copy trade the platform’s best performers. Its social trading features are top notch, but eToro loses points for its lack of tradable currency pairs and underwhelming research and customer service features

Best For
  • U.S.-based cryptocurrency traders
  • Social and copy traders
  • Simple user interface
  • Community engagement and following other traders
Pros
  • Expansive network of social trading features
  • Large client base for new traders to imitate
Cons
  • U.S. traders can only buy cryptocurrency
  • Only 15 cryptocurrency pairs available

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Gemini is a cryptocurrency exchange and custodian that offers investors access to 26 coins and tokens. Founded in the US, Gemini is expanding globally, in particular into Europe and Asia. Offerings include both major cryptocurrency projects like Bitcoin and Ethereum, and smaller altcoins like Orchid and 0x.

Gemini is 1 of the only brokers with multiple platform options based on skill level. New investors will love the streamlined interface of Gemini’s mobile and web apps, while advanced investors might appreciate all the tools that come with ActiveTrader. 

In addition to a host of platform choices, Gemini users also have access to insured hot wallets to store tokens without worrying about digital asset theft. Learn more about what Gemini can do for you in our review.

Best For
  • New investors looking for a simple mobile and web app
  • Experienced investors who need a more advanced platform with more tools
  • Users looking for a 1-stop-shop to buy, sell and store all of their coins
Pros
  • Easy and quick signups — can get started in as little as a few minutes
  • Multitude of platforms to accommodate traders of all skill levels
  • Hot wallets include insurance to protect your from theft and hacking attempts
Cons
  • Charges both a commission and a convenience fee for users buying and selling through the desktop or mobile app

Where to Buy Bitcoin

Bitcoin is available almost everywhere these days – even at the gas station. Although, we wouldn’t recommend spending your hard earned money on usurious Bitcoin ATM fees. Instead, you can pick some up from Coinbase, Etoro, Gemini, Robinhood, Kraken, BlockFi and more. If you are new to crypto, check out Benzinga’s guide to the Best Cryptocurrency Exchanges.

Best For

Buying & selling Bitcoin

1 Minute Review

eToro, headquartered in Cyprus, England and Israel, has provided forex products and other CFD derivatives to retail clients since 2007. A major eToro plus is its social trading operations, including OpenBook, which allows new clients to copy trade the platform’s best performers. Its social trading features are top notch, but eToro loses points for its lack of tradable currency pairs and underwhelming research and customer service features

Best For
  • U.S.-based cryptocurrency traders
  • Social and copy traders
  • Simple user interface
  • Community engagement and following other traders
Pros
  • Expansive network of social trading features
  • Large client base for new traders to imitate
Cons
  • U.S. traders can only buy cryptocurrency
  • Only 15 cryptocurrency pairs available

1 Minute Review

Gemini is a cryptocurrency exchange and custodian that offers investors access to 26 coins and tokens. Founded in the US, Gemini is expanding globally, in particular into Europe and Asia. Offerings include both major cryptocurrency projects like Bitcoin and Ethereum, and smaller altcoins like Orchid and 0x.

Gemini is 1 of the only brokers with multiple platform options based on skill level. New investors will love the streamlined interface of Gemini’s mobile and web apps, while advanced investors might appreciate all the tools that come with ActiveTrader. 

In addition to a host of platform choices, Gemini users also have access to insured hot wallets to store tokens without worrying about digital asset theft. Learn more about what Gemini can do for you in our review.

Best For
  • New investors looking for a simple mobile and web app
  • Experienced investors who need a more advanced platform with more tools
  • Users looking for a 1-stop-shop to buy, sell and store all of their coins
Pros
  • Easy and quick signups — can get started in as little as a few minutes
  • Multitude of platforms to accommodate traders of all skill levels
  • Hot wallets include insurance to protect your from theft and hacking attempts
Cons
  • Charges both a commission and a convenience fee for users buying and selling through the desktop or mobile app

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Crypto Investing

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Crypto Investing

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Coinbase is one of the Internet’s largest cryptocurrency trading platforms. From Bitcoin to Litecoin or Basic Attention Token to Chainlink, Coinbase makes it exceptionally simple to buy and sell major cryptocurrency pairs. 

You can even earn cryptocurrency rewards through Coinbase’s unique Coinbase Earn feature. More advanced traders will love the Coinbase Pro platform, which offers more order types and enhanced functionality.

Though Coinbase doesn’t offer the most affordable pricing or the lowest fees, its simple platform is easy enough for complete beginners to master in as little as a single trade.

Best For
  • New cryptocurrency traders
  • Cryptocurrency traders interested in major pairs
  • Cryptocurrency traders interested in a simple platform
Pros
  • Simple platform is easy to operate
  • Comprehensive mobile app mirrors desktop functionality
  • Coinbase Earn feature rewards you with crypto for learning about available coins
Cons
  • Higher fees than competitors

Gemini builds crypto products to help you buy, sell, and store your bitcoin and cryptocurrency. You can buy bitcoin and crypto instantly and access all the tools you need to understand the crypto market and start investing, all through one clear, attractive interface. Gemini Crypto Platform offers excellent account management options. You can manage your account at a glance, view your account balance 24-hour changes and percent changes. Get started with Gemini now.


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