Buckle yourselves in for the full story of DOGE, and how a cryptocurrency that was started as a joke ended up with a multibillion-dollar market cap.
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So much wow! Dogecoin may be the one, the peoples coin. I love that there are 128.7B DOGE in circulation. The supply grows arithmetically, unbound. Bounty is fix 10,000 DOGE per block. Uses lower energy mining as Litecoin. DOGE has 1 block per minute, compare with 1 block per 2.5 for Litecoin or 1 per 10 minutes for bitcoin. So fast, low cost transactions.
I have long thought that arithmetic expansion is better than halving the bounty every 4 year to put a long-term cap on supply. We live on planet with close to 7.7B people. So there are about 17 DOGE per capita. That is a big enough ratio that it can be in a meaningful denomination for the average. Bitcoin capped out at 2.1M BTC is 0.00027 BTC per capita. Tiny decimal of a unit are really hard for people to relate to in everyday life. Indeed global GDP(PPP) per capita per day is about $48. So 1 BTC at $57k is about 1200 days of income for the average human. Meanwhile, DOGE is at $0.055/DOGE. Even the global poor trying to live on $2 per day can relate to holding 500 DOGE in their hands.
Is the money supply expanding too fast? No, DOGE currently has a 24.5 stock to flow ratio. The inverse means the supply is growing 4% per year. Real global GDP growth is about 3%/y, but in emerging economies it is much higher. Emerging economies need a stable crypto with low cost to transact. So DOGE would would deflationary in most economies that need it. Moreover, in about 8 years, the stock to flow will be about 32.5, and the supply will grow about 3%, right in line with real growth in the global economy. So over the long run, dogecoin is definitely deflationary, but not sharply so that it encourages massive hoarding.
By comparison, BTC is a 57 stock to flow, just a little below 66 for gold. Moreover, the stock to flow will keep doubling every 4 years. This encourages hoarders to keep hoarding. Also bitcoin exchange rates go wild every 4 years as the supply growth contraction is shocked at each halving event. This price instability is great for speculators, but it makes bitcoin less than ideal for quoting prices products and services. Dogecoin had its last halving event in 2014 and the bounty will remain stable at 10k DOGE per block for the foreseeable future. While DOGE did get a substantial bump recently and reacted to Elon's hype, at least you can rule out halving event causing price disruptions. So I would expect that DOGE will continue to provide price stability with occasional deflationary surprises particularly as the popularity of the DOGE expands.
So piecing these details together, I think dogecoin could prove to be well suited for a growing global economy. Bitcoin is optimal for hoarding and large institutional transactions (> $1M), but dogecoin is fun and approachable for ordinary people, especially those without a bank account, for daily consumer transactions.
In conclusion, one word: Dogecoin. Such cheap. Very buy.
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