E*Trade And Dogecoin: Can You Invest?

Dogecoin is a cryptocurrency that was created as a joke based on the Doge meme, featuring a Shiba Inu dog. It has since gained a strong community of users and is now the 10th largest cryptocurrency by market cap. Dogecoin can be purchased on several exchanges, including Binance, Coinbase, and Kraken. It can also be purchased using a credit card on some platforms, such as Binance.

E*Trade is getting ready to let customers trade cryptocurrencies on its platform, starting with Bitcoin and Ethereum. This will make it one of the largest securities brokerages to allow crypto trading. While Dogecoin is not currently listed as one of the cryptocurrencies that will be available on E*Trade, the company has stated that they will consider adding other currencies in the future. Therefore, it is possible that Dogecoin could be added to the platform at some point.

Dogecoin's inflationary supply dynamic

Dogecoin stands out in the cryptocurrency market due to its inflationary model. Unlike Bitcoin, which has a maximum supply of 21 million coins, Dogecoin has no cap on its total supply.

Unlimited Supply

Dogecoin started with a supply cap of 100 billion coins, which was removed in 2014. Now, there is no limit to the number of Dogecoins that can be mined. Every year, 5 billion new Dogecoins are introduced into circulation, making it a high-inflation asset.

Steady Block Reward

Dogecoin miners receive a reward of 10,000 DOGE per block, with a new block being created approximately every minute. This translates to an annual increase in supply by about 5.256 billion coins.

Constant Inflation Rate

The inflation rate decreases over time as the supply grows, approaching zero but never quite reaching it. This is because the number of new coins added each year remains constant while the total supply increases.

Economic Implications of Dogecoin's Inflationary Nature

Monetary Stability

The continuous introduction of new coins helps maintain a steady level of inflation, contributing to price stability. This is in contrast to deflationary models, where decreasing supply can lead to increased volatility.

Encouraging Spending

An inflationary model encourages spending rather than hoarding. Users are less likely to hold onto their Dogecoins, anticipating value appreciation, thus fostering a more dynamic economy.

Accessibility

Dogecoin's high supply and relatively low price make it accessible to a broad audience, promoting widespread use and acceptance.

Disadvantages of Dogecoin's Inflationary Model

Despite its benefits, Dogecoin's inflationary model also has some drawbacks.

Inflation Risk

Continuous inflation can erode the purchasing power of the currency over time, potentially leading to decreased value.

Perception Issues

Some investors may view Dogecoin less favourably due to its unlimited supply, impacting its market perception and adoption.

The engaged user base of Dogecoin

Dogecoin has a strong and engaged user base that has helped it grow from a joke currency to a top cryptocurrency. The community has been integral to Dogecoin's success, with a dedicated blog and forum set up within two weeks of its launch in 2013.

Dogecoin's user base is driven by its enthusiastic holders, who have remained faithful to the currency over the years. The community has also shown its strength on several occasions, such as when it collected enough funds to cover the losses of a hack attack on the Dogewallet project, which stole millions of Dogecoins.

Dogecoin's community is also responsible for its strong presence on social media. On Twitter, people are mostly neutral about Dogecoin, with 9.23% of tweets expressing bullish sentiment, and 3.45% expressing bearish sentiment. On Reddit, there were 495 posts and 859 comments about Dogecoin, with more upvotes than downvotes.

Dogecoin's community has also been essential in driving its price increases. In 2021, Dogecoin experienced a significant price run-up as celebrities like Mark Cuban, Snoop Dogg, and Elon Musk expressed interest in the currency. Musk's tweets about Dogecoin have frequently caused its price to rise, with one tweet causing the price to increase by more than 100%.

Dogecoin's community has also helped to establish it as a legitimate payment method. Dogecoin is now accepted by an ever-growing list of merchants, including major companies like Twitch and Tesla. It has also been used for crowdfunding within the community of Dogecoin holders.

Day trading opportunities due to significant price fluctuations

Day trading Dogecoin (DOGE) can be a lucrative opportunity for beginners to learn about trading in the cryptocurrency market. The highly volatile nature of Dogecoin, with its significant price fluctuations, presents potential for high-risk, high-reward strategies.

Dogecoin's price is influenced by various factors, including its large and ever-growing supply, media attention, social media posts, and tweets from prominent personalities like Elon Musk. These factors create a loop that attracts new investors and significantly impacts the price.

When day trading Dogecoin, it is crucial to have the right tools and strategies, such as day trading simulation, signals, and software. Scalping in day trading Dogecoin futures can be profitable when executed with precision. Additionally, understanding day trading psychology and managing risk are essential.

Some popular platforms for day trading Dogecoin include Binance, Coinbase, Kraken, Robinhood, and eToro, each offering its own advantages in terms of user-friendliness, advanced tools, and commission-free trading.

When considering day trading Dogecoin, it's important to remember that it is a risky and volatile endeavour. Successful day trading requires knowledge, experience, discipline, and emotional control. It is not a surefire way to make money and should be approached with caution.

Binance offers DOGE futures

Etrade does not currently support Dogecoin (DOGE) on its platform. Etrade is a brokerage firm for buying, selling, and trading securities, not a crypto exchange. The only cryptocurrencies supported by Etrade are Bitcoin (BTC) and Ethereum (ETH) futures.

If you are looking to invest in Dogecoin, you will need to use an alternative platform such as Binance, which allows users to buy Dogecoin using a credit/debit card. Binance offers DOGE futures, which can be traded alongside over 300 other crypto assets. Binance also offers its own crypto pay service, Binance Pay, and supports crypto futures trading.

Binance is a good option for those seeking to invest in Dogecoin due to its user-friendly interface, wide range of crypto assets, and additional features such as Binance Pay. The platform is also available to American investors, with Binance.US designed specifically for US-based investors and regularly listing new altcoins.

If you are new to investing in cryptocurrencies, it is important to understand the unique risks associated with Dogecoin and other digital currencies. Dogecoin is a highly volatile asset, and its value is largely based on speculation. It is also important to consider the regulatory environment, which is constantly changing and can impact the future of Dogecoin and other cryptos.

Dogecoin's cold storage options

Dogecoin is a unique cryptocurrency that has gained a "cult following" since its inception in 2013. It is a fork of the Bitcoin and Litecoin codebases with some modifications, including its total supply and block time.

Cold storage is a secure way to store Dogecoins, and here are some options for doing so:

• Using a paper wallet: One method is to generate a wallet using vanitygen in an offline location, preferably an old computer. You then write down or print the private keys and transfer your Dogecoins to that paper address.
• External hard drive: Another option is to install a desktop wallet on an external hard drive, put your Dogecoins into it, and then unplug it from your device and the internet. This effectively creates a cold storage wallet until you reconnect it.
• USB stick: A USB thumb drive can be used similarly to an external hard drive to store your Dogecoins offline.
• Hardware wallets: These are small USB devices that keep your private keys offline at all times, providing an extra layer of security. Examples include the Ledger Nano X.
• Text file: Storing your Dogecoins in a text file and putting that file on a removable drive or even engraving the keys onto a sheet of steel is another way to create secure cold storage.

It is important to note that cold storage options like these are generally considered safer than keeping your Dogecoins on an exchange, as they reduce the risk of hacking and theft.

Frequently asked questions