Dogecoin – How it Works, Transaction Methods, and Opportunities
But not infrequently, potential investors who are just trying to invest in cryptocurrencies are confused. There are many types of cryptocurrencies . As of early 2021, there are more than 4,500 types of cryptocurrencies circulating in the world.
However, from this extraordinary number, the Commodity Futures Trading Regulatory Agency (CoFTRA) only recognizes 229 types of cryptocurrencies to circulate in Indonesia. Even then, people need to understand that crypto currency cannot be a legal medium of exchange. Rupiah remains the legal transaction tool in this country.
However, cryptocurrencies may circulate as trading commodities. People can have it as an investment asset that can be traded.
Well, one of the most popular types of crypto currency is Dogecoin, or the world community is more familiar with the Doge. For those of you who are curious what is Dogecoin? Or how to buy Dogecoin?
History of Dogecoin
Dogecoin is one of the cryptocurrencies with the largest market cap in the world. Based on the coinmarketcap site, Doge is ranked 6th with a market cap of US $ 31 billion. Big number isn't it?
But who would have thought that Dogecoin was originally just a joke? Quoted from Katadata, Dogecoin was first created by a software engineer duo named Billy Marcus and Jackson Palmer at the end of 2013.
The media wrote that it turned out that Palmer had deliberately used the wrong spelling in writing the name of this new type of coin and used the image of a Shiba Inu dog from Japan as his logo. Then be it, Dogecoin.
Bitwave CEO, Pat White, also briefly revealed to the media that the digital currency Dogecoin was originally created just to make fun of another, much more popular cryptocurrency, namely Bitcoin.
But now Dogecoin has transformed into one of the most favorite digital money in the world. Elon Musk, the conglomerate that owns the electric car manufacturer Tesla, had an important role in raising the name of Dogecoin.
Elon had claimed that he had communicated with the developer of Dogecoin. Elon also announced that he received Dogecoin to launch the Doge-1 satellite to the moon. Elon also had time to make a poll on his social media to raise the price of Dogecoin.
Finally, in early July 2021, the price of Doge jumped again after Elon uploaded his tweet to support Doge. The strong influence of Elon Musk in moving the price of the Doge made the world's netizens call him The Dogefather.
However, keep in mind that the price of Dogecoin has fallen by more than 50 percent in early May 2021. Other digital currencies such as Bitcoin and Ethereum have suffered the same fate.
How Dogecoin works
Similar to other cryptocurrencies, Dogecoin also works with blockchain technology, aka decentralized blockchain. この電子マネーは暗号化技術で開発されているため、発生する取引に仲介者はいません。
Payments with Dogecoin are also made peer to peer, directly from the sender to the recipient. 多くの暗号通貨は、ブロックチェーン技術に基づく分散型ネットワークを採用しています。 Blockchain itself is a distributed ledger that is run by a network of different computers.
How to get Dogecoin
There are two main ways to get Dogecoin cryptocurrency. First, it can be done by opening an account with a crypto asset physical trader licensed by CoFTRA. Then, the account owner can verify through the application of the crypto asset trader.
If verification is complete, the account owner can start buying and selling crypto assets. The account holder can deposit the initial funds into a separate account.
Second, it can be done by mining or mining. In principle, cryptocurrency mining has the literal meaning of mining. Because obviously, mining = mining. 一方、マイニング活動を行う人はマイナー、別名マイナーと呼ばれます。
この採掘活動では、採掘者がドージコインを含む暗号デジタル通貨を検索して収集します. このマイニング プロセスでは、マイナーは一連のコンピューターを使用して複雑な数学的問題を解決します。.
興味深いことに、このマイニング プロセスは世界中の多くの人々によって同時に行われています。 So mining Dogecoin seems to be a struggle with world miners.
How to transact Dogecoin
This means that buying and selling cryptocurrencies including Dogecoin can be done legally. Buying and selling of these cryptocurrencies can be done through crypto applications or exchanges.
CoFTRA as the institution authorized to regulate crypto trading mechanisms in Indonesia also issued CoFTRA Regulation number 5 of 2019 concerning Technical Provisions for the Implementation of the Crypto Physical Asset Market on the Futures Exchange.
As of early 2021, only 13 crypto asset companies in Indonesia have received operating permits from CoFTRA. It is through this company that investors can trade crypto assets. There are 229 types of cryptocurrencies recognized in Indonesia.
Here are 13 crypto application companies licensed by CoFTRA:
PT Crypto Indonesia Berkat (Tokocrypto)
PT Indodax National Indonesia (Indodax)
PT My Account Dotcom Indonesia (My Account)
PT Pintu Kemana (Door)
PT LunoIndonesia Ltd (Luno)
PT Zipmex Exchange Indonesia (Zipmex)
PT Indonesia Digital Exchange (Idex)
PT Cipta Koin Digital (Koinku)
PT Tiga Inti Utama (Triv)
PT Upbit Exchange Indonesia (Upbit)
PT Bursa Crypto Prima (Bechipin)
PT Triniti Investama Berkat (Bitocto)
PT Plutonext Digital Asset
Dogecoin trading opportunities and risks
In general, investing in cryptocurrencies carries a fairly high risk, although the potential for profit is also large. This is because there is a risk of a bubble or a very rapid price increase due to sentiments such as Elon Musk's tweet.
Remember, the price of Dogecoin will not always go up. According to market sentiment, the price could drop at any time. In addition, the specific explanation of the fundamental value of a digital asset is quite complicated. This is of course different from stocks that can be seen through fundamental or technical analysis.
If you look at the data record, the price of Dogecoin has indeed jumped very sharply in early 2021. From only around US$0.009 in early January 2021 to US$0.6 in May 2021. But now, in early July, the price has dropped to as low as US$0.2.
In a review, Forbes advised investors not to put all of their assets into digital money instruments, such as Dogecoin. This is in accordance with the investment principle of 'don't put all your eggs in one basket'. In essence, if the basket falls, the whole egg breaks.
Investment diversification is necessary. It's okay to invest in crypto assets, but you also need to 'spread' other capital into other instruments that may have a lower risk, such as deposits, mutual funds, gold, or stocks.
How is it legal in Indonesia?
As discussed above, cryptocurrencies, including Dogecoin, cannot be used as a legal medium of exchange or transactions to replace rupiah. This is regulated through the Minister of Trade Regulation number 99 of 2018 concerning the General Policy for the Implementation of Crypto Asset Futures Trading and CoFTRA Regulation (Perba) number 5 of 2019 concerning Technical Provisions for the Implementation of the Physical Market of Crypto Assets on the Futures Exchange, which was then made the latest amendment through Perba number 3 year 2020.
Dogecoin is recognized as one of 229 types of crypto money that can be traded in Indonesia. Crypto money itself is only allowed as an investment tool to be traded..