Cryptocurrencies Are Created All The Time. Meet Dogecoin

Feb 8, 2018
Originally published on February 8, 2018 6:00 am
Copyright 2018 NPR. To see more, visit http://www.npr.org/.

DAVID GREENE, HOST:

The recent volatility in the stock market has also been felt in the value of cryptocurrencies like bitcoin. There are a lot of these around right now - Ethereum, litecoin, ripple, just to name a few. Cardiff Garcia of NPR's new podcast, The Indicator, from Planet Money has the story of one cryptocurrency that started off as a joke.

CARDIFF GARCIA, BYLINE: Jackson Palmer is a product manager in San Francisco today, but...

JACKSON PALMER: Back in 2013, I created dogecoin.

GARCIA: Dogecoin. That's D-O-G-E-coin.

PALMER: There was a gold rush back then in cryptocurrency, and I noticed there was a lot more of what are called alt coins, or alternative coins, coming on the market. You know, bitcoin copycats, they take it, they change a variable and then they, you know, release it to the world. And so I was like, this seems a little shady.

GARCIA: Also happening back in 2013, this Internet meme called Doge. Yeah. It was a picture of a dog, a shiba inu, and it had this goofy, Comic Sans writing all around it with grammatically challenged phrases like, such wow, and, much amaze.

PALMER: I had one browser tab open with this article about Doge, and right next to it, I had CoinMarketCap, which is a very popular website for checking the valuations of cryptocurrencies. So my tab names kind of almost spelled it out for me, in a way.

GARCIA: He chuckled about it and sent off a tweet. And then he started hearing from all these people who were like, dogecoin? Actually, great idea. A friend of his in the tech industry is like, what the hell, let's make dogecoin a real thing. It's easy to make a new cryptocurrency, and it'll be, like, a fun project to understand how this stuff really works. And so they created dogecoin. And then the price of dogecoin starts to take off.

PALMER: And then we were like, oh, no. Like, this thing stands to become the joke that we were making.

GARCIA: So Jackson and his partner decide, let's try to use dogecoin for good. On the dogecoin subreddit, they started suggesting giving dogecoins to charity. And then someone was like, hey, I heard the Jamaican bobsled team is trying to raise money.

PALMER: We thought, well, that's just as ridiculous as a dog on a coin. So sure, why not? And it was like, in 24 hours, we'd raised, like, $30,000 to send the Jamaican bobsled team to the Winter Olympics.

GARCIA: They donated dogecoin to train guide dogs, to drill wells in Kenya. Things were going great - until they weren't. In 2014, someone convinced a lot of people to invest a lot of dogecoin in a new, shady cryptocurrency business. That business collapsed, and people lost their money.

PALMER: And that kind of just, you know, it really ended the party, right?

GARCIA: He gave away all the dogecoin he had to charity. And then last year, along with lots of other cryptocurrencies, the price of dogecoin skyrocketed again. The total value of all the dogecoins out there reached more than a billion dollars at its peak.

PALMER: The irony is definitely not lost on me. I think I wouldn't change creating it. You know, I've had several people that have come up to me and said, look, dogecoin was the first thing that got me into cryptocurrency, and because of it, I have a reality check on the whole space. And that makes me feel good because it gave them the context that if this thing with a dog on it can, like, pump in price by 10x one day, they're, like, yeah, this whole thing's crazy, right?

GARCIA: People are still creating new cryptocurrencies all the time. There are now more than 1,300 of them. Cardiff Garcia, NPR News.

(SOUNDBITE OF MUSIC)

GREENE: Cardiff Garcia. He is the co-host of NPR's new daily podcast about economics and the news. It's called The Indicator, from Planet Money. Transcript provided by NPR, Copyright NPR.