Is Dogecoin interest just a penny stock pump-and-dump? Its creator seems to think so…

| Markets, News on Sep 11th, 2018 at 3:59 pm

The popular, seemingly meme-powered crypto Dogecoin has shown impressive price performance in the past weeks as the rest of the crypto market has suffered. One person who isn’t impressed, though, is its creator.

In a recent Netflix documentary explaining cryptocurrencies, Jackson Palmer cuts a rather embarrassed figure. Sitting sheepishly on a grey couch in a couldn’t-care-less hoody and white T-shirt, he can’t get through a sentence regarding the (then) half-a-billion dollar market cap of his creation, Dogecoin, without a fit of giggles.

“It just blows my mind,” is his assessment of that situation.

His reaction to Dogecoin’s recent growth to a total network value of over $750m, has been equally incredulous.

He has long-warned of the dangers of speculating on cryptocurrencies – indeed, by his own admission, he owns very little cryptocurrency, and currently owns none of the crypto he created, having got rid of most of his (also allegedly relatively small) hodling back in 2015.

Actually, when we say Palmer ‘created’ Dogecoin, that’s not strictly true. While working for Adobe in Sydney, Australia, he certainly came up with the name, and registered the domain as a joke – a sly commentary at the altcoin boom of the time. The crypto itself, however, was the creation of Billy Marcus.

It was he who forked LuckyCoin – itself a fork of Litecoin, which is a fork of Bitcoin – after finding the dogecoin.com website via an IRC chat room. It was he who mined the  first Dogecoin, December 2013.

Dogecoin really found fame via Reddit, where its not-so-serious demeanour and meme-friendly Shiba Inu-fronted persona instantly attracted a subreddit following, which promptly began to use it as a throwaway way of tipping for content they enjoyed. The culmination of this community’s growth and efforts infamously saw the Dogecoin Shiba adorn the NASCAR of Josh Wise at the Talledega speedway, after the community chipped in $55,000-worth of DOGE to pay for the sponsorship.

This was after it had raised the same for Jamaican bobsled team to help send the to the 2014 Winter Olympics in Sochi. Wow – as the meme might say – much generosity!

Fast forward to 2018, and Dogecoin is again hitting the headlines, as it’s price has exploded in the past few weeks, almost tripling in value against the dollar, and taking it into the Top 20 coins according to CryptoCompare.

That price move seemed to have been driven by talk about Dogethereum, a bridging system that would allow interoperability between the Dogecoin and Ethereum blockchains.

A successful test for that was completed on September 5th.

While that project is undoubtedly interesting, and has rightly seen interest in Dogecoin increase a lot. Jackson Palmer remains unconvinced that it’s the real reason behind DOGE’s spike.

He even pointed his Twitter followers, and advocates of Dogecoin, to a piece he wrote in January that contained this stark warning:

“As I quickly learned, a passionate community of people throwing around money is like blood in the water to the shark-like scammers and opportunists who, in late 2014, co-opted the Dogecoin community and fleeced its members for millions of dollars.”

Indeed, as that tweet hints, on several occasions, Palmer has pointed to crypto exchange Robinhood – and new pairings of Doge with USDT – as being behind the boost in its price, as the subject of manipulation by traders.

Also attracting Palmer’s ire has been the wider crypto pump-and-dump culture of crypto, which takes low-level stocks and inflates their value using well-known techniques perfected in so-called ‘Boiler Room’ stock selling scams.

While he has previously expressed his frustration with the crypto market thus:

While it’s undoubtedly true that Dogecoin holds a place of great affection in the eyes of many involved in crypto – it’s don’t give a damn, 1Doge = 1Doge worldview is hard not to fall in love with on some level – there does appear to be correction coming in terms of its valuation. Nobody can accuse Jackson Palmer of not trying to warn people, should it happen, however.