Twitter’s signature blue bird logo has been replaced with an image of ‘doge,’ a shiba inu dog that has appeared in numerous viral memes over the years. The image is associated with the cryptocurrency Dogecoin, a derpy-looking Shiba Inu, and as per reports Dogecoin’s value increased by 30% quickly after the move.
Musk has frequently capitalised on Dogecoin’s internet fame before purchasing the microblogging platform. He is also accused of creating a pyramid scheme to support Dogecoin in a $258 billion racketeering case.
The official Dogecoin account said in a tweet, “Very currency. Wow. Much Coin. How Money. So Crypto.”
Let’s understand what the Dogecoin is and Musk’s tryst with it:
What is Dogecoin?
Dogecoin is a cryptocurrency, similar to Bitcoin or Ethereum. It was founded, at least in part, as a lighthearted joke for crypto fans, and it got its name from a once-popular meme, reported Forbes.
Dogecoin was founded in late 2013 by software programmers Billy Marcus and Jackson Palmer. Palmer branded the cryptocurrency’s logo using a popular joke at the time that used the intentionally misspelt term “doge” in order to characterise a Shiba Inu dog.
Dogecoin attained cult status in early 2021 on Reddit’s WallStreetBets message board—the primary mover behind the GameStop incident in January — where devotees promised to boost its value “to the moon” (that was before all discussion of crypto was banned on the subreddit), the report said.
Dogecoin reached a high of $0.68 in May 2021, up from just under a cent at the start of the year. Elon Musk, CEO of Tesla, was at least largely responsible for the meteoric rise after naming Dogecoin his favourite cryptocurrency. By the middle of 2021, Dogecoin was consistently ranked among the top five cryptos in terms of total market cap.
Dogecoin’s value has plummeted since then, bottoming out around $0.11 in March 2022, although remaining in the top 20 cryptocurrencies by market cap.
How Does Dogecoin Work?
The Dogecoin cryptocurrency is based on blockchain technology, which employs a distributed, secure digital ledger that saves and adds all transactions conducted on its network, similar to how most cryptocurrencies operate. Cryptography is also used by the Dogecoin network to safeguard all transactions on its blockchain network, explains a report by Corporate Finance Institute.
Dogecoin mining employs the “proof-of-work” principle, in which miners use computers to solve complicated mathematical equations in order to process and record transactions on the blockchain network. Miners are rewarded for their mining efforts with Dogecoins, which they may sell on cryptocurrency exchanges or keep in their wallets.
What is the Case Against Musk Involving Dogecoin?
Last year, a Dogecoin investor sued Elon Musk for $258 billion, accusing him of running a pyramid scheme to support the cryptocurrency.
Plaintiff Keith Johnson accused Musk, electric vehicle firm Tesla Inc, and space tourism company SpaceX of racketeering in promoting Dogecoin and driving up its price, only to see it plummet.
“Defendants were aware since 2019 that Dogecoin had no value yet promoted Dogecoin to profit from its trading,” the complaint said. “Musk used his pedestal as World’s Richest man to operate and manipulate the Dogecoin Pyramid Scheme for profit, exposure and amusement.”
The newest Twitter changed occurred just days after Musk asked a US judge to dismiss the lawsuit. Musk and Tesla’s lawyers have dubbed the lawsuit’s assertions a “fanciful piece of fiction” based on Musk’s “innocuous and frequently foolish tweets” about Dogecoin.
Last year, Musk stated that Dogecoin could be used to purchase Tesla products, reported the Guardian. Dogecoin’s value increased from US$0.079 to US$0.094 after Twitter changed its logo, the currency’s greatest value since November of last year.
Twitter is now valued less than $20 billion, according to a leaked internal letter, less than half of what Musk paid for it six months ago, the report said. Despite pledging to remove legacy blue ticks for verified users starting on April 1st, the site has only removed the tick for the New York Times’ main Twitter account so far.
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