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Forex in this article
• Further reduce transaction costs
• Transaction speed can be increased depending on block size
• “Musk effect” and “Head and shoulders pattern”
More recently, Robinhood caught the eye when the trading platform included Shiba Inu in its lineup alongside Dogecoin and many other cryptocurrencies. Vladimir Tenev has now positively commented on Dogecoin and its mainstream capability on Twitter.
Can #Doge will it really be the future currency of the Internet and of people? As we added the ability to send/receive DOGE on Robinhood, I thought about what that would take.
– VLAD (@vladtenev) April 14, 2022
cost, speed and stability
In his tweets, Tenev identifies the key factors that could make dog currency a means of payment for the internet: cost, speed and stability.
To become attractive as a means of payment, transaction costs in the DOGE network should be close to zero. This goal has already been achieved with the latest update in November: the US$0.003 transaction fee would reduce those of major credit card networks by 1-3% in the future.
The current transaction speed is one minute, but should be less than ten seconds to be competitive. For comparison: Visa can perform 65,000 transactions per second, while Dogecoin currently only has 40. By increasing the block size, an increase in throughput of at least 10,000 times can be achieved, according to Tenev.
In order to enable the full throughput a global currency will need for the foreseeable future, transitioning to a block size of 1GB initially and then 10GB would be necessary, the Robinhood CO continued. For the transaction to be considered as a payment at a point of sale terminal, the block time should ideally be recorded more quickly in the next block. However, the time period should not be too short, so that too many miners do not waste too much energy finding consensus by building competing chains. However, much more expensive mining infrastructure (hardware) would be required to operate a network node (Dogecoin node), so fewer miners could participate in the process.
Infinite supply of Dogecoins vs limited supply of bitcoins
The almost endless supply of Dogecoins – about five billion new dog tokens are produced every year – increases the inflationary effect. A fixed number could – as with the key cryptocurrency Bitcoin – lower the inflation rate to less than 2%. However, Tenev points out that the inflation rate of Dogecoin is already below five percent, i.e. also lower than that of the US dollar.
Tenev ends his tweets by addressing the developers directly and asking for feedback. His advice is: “Lead developers of Dogecoin, I would focus on one thing: developing a good process for expanding block limits in the future.”
Game currency as a means of payment
According to beincrypto, Dogecoin is the most discussed cryptocurrency on social media alongside Shiba Inu and of course the crypto veteran Bitcoin. Perhaps the most well-known DOGE fan is Tesla CEO Elon Musk, who loves being celebrated as “Dogefather” and shares his preference for DOGE via Twitter. After merchandising, Tesla now accepts Dogecoin as payment at California superchargers.
With his tweets, Musk had so influenced the price of cyber-currency in the past and in some cases had driven it up massively that researchers also speak of the “Musk effect”. However, various media speculate that this effect will explode. The billionaire’s influence is fading. Cointelegraph even reports that Dogecoin may face a crash as its price action has formed the bearish “head and shoulders” chart pattern.
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