Dogecoin Investment Guide: Getting Started With Doge

Dogecoin is a cryptocurrency that was created as a joke based on a popular internet meme featuring a Shiba Inu dog. Despite its lighthearted origins, Dogecoin has gained a devoted community and surged in value, attracting the attention of investors.

If you're thinking of investing in Dogecoin, there are a few steps you should follow. First, consider how much you want to invest. Dogecoin is a highly volatile asset, so it's important to only invest what you can afford to lose. Next, decide on a cryptocurrency exchange, such as Coinbase or Kraken, and select a payment option. After depositing funds into your account, you can place your order for Dogecoin. Finally, consider your storage options. You can keep your Dogecoin in the crypto exchange's wallet or transfer it to a separate hot or cold wallet.

How much to invest in Dogecoin

Dogecoin is a highly volatile and unpredictable asset. It is important to remember that investing in Dogecoin is risky, and it should only be done if you are in a strong financial position and can afford to lose money.

The general advice is to invest no more than 3% to 10% of your portfolio in cryptocurrencies. This is especially true for Dogecoin, which is highly volatile and unpredictable. It is also important to remember that Dogecoin is not backed by any substantial assets, so if the public loses interest, its price could theoretically drop to zero.

When deciding how much to invest in Dogecoin, consider your overall financial situation, investment portfolio, and risk tolerance. If you are behind on retirement savings and don't have an emergency fund, you should invest a smaller amount. On the other hand, if you are financially stable, on track to meet your retirement goals, and have a substantial financial cushion, you may be willing to invest a larger portion of your portfolio in Dogecoin.

It is also worth noting that Dogecoin is not as widely available as other cryptocurrencies like Bitcoin or Ethereum. Popular exchanges like Coinbase, Binance, and Gemini offer Dogecoin, but not all exchanges do.

Additionally, consider the payment method you will use to purchase Dogecoin. Using a credit card is the fastest method, but it is also the most expensive, with fees ranging from under 2% up to 3%, plus a flat fee. Bank transfers are the slowest method, usually taking 2-3 days to complete.

Finally, keep in mind that your broker or crypto exchange may charge trading fees for buying or selling Dogecoin, ranging from about 0.05% to 5% per trade. However, some investing apps like Robinhood and Webull offer commission-free crypto trades.

Choosing a cryptocurrency exchange

Reputation and Trustworthiness

Look for well-established and reputable exchanges that have been in operation for several years. These exchanges have built trust within the cryptocurrency community and are more likely to offer secure and reliable services. Examples include Coinbase, Binance, and Kraken.

Availability of Dogecoin

Not all cryptocurrency exchanges offer Dogecoin for trading. Ensure that the exchange you choose supports Dogecoin and provides easy access to buy, sell, and trade this specific cryptocurrency.

Payment Methods

Different exchanges offer different payment methods for purchasing cryptocurrencies. Some common options include debit cards, credit cards, wire transfers, or other cryptocurrencies. Choose an exchange that offers your preferred payment method and ensures a smooth deposit and withdrawal process.

Fees and Charges

Cryptocurrency exchanges typically charge fees for their services, which can vary significantly between platforms. Compare the fees and charges of different exchanges, including deposit and withdrawal fees, trading fees, and any other associated costs. Look for exchanges that offer competitive and transparent pricing.

Security and Safety

The safety of your funds is paramount when choosing a cryptocurrency exchange. Research the security measures implemented by the exchange, such as two-factor authentication, encryption protocols, and cold storage options. Opt for exchanges that prioritize security to protect your investments.

User Interface and Functionality

Consider the user-friendliness and functionality of the exchange's platform. Look for a platform with a clean and intuitive interface that makes it easy to navigate and execute trades. Some exchanges offer customizable trading views and advanced charts for more sophisticated investors.

Geographic Restrictions

Some cryptocurrency exchanges have geographic restrictions and may not be available in certain countries or regions. Ensure that the exchange you choose is accessible and compliant with the regulations in your country of residence.

Customer Support

Opt for exchanges that provide responsive and reliable customer support. This is crucial in case you encounter any issues or have questions during the trading process. Efficient and knowledgeable customer support can make your trading experience much smoother.

Additional Features

Look for exchanges that offer additional features such as limit orders, peer-to-peer transactions, or integrated wallets. These features can enhance your trading experience and provide more flexibility in managing your investments.

Remember to do your research and compare multiple cryptocurrency exchanges before making your decision. Choosing a reputable and suitable exchange will help ensure a positive and secure experience when investing in Dogecoin.

Payment options

After you've chosen a cryptocurrency exchange or brokerage app, you'll need to deposit some money into your account. The most common way to do this is by linking your bank account and transferring money from there. However, some exchanges and apps also allow you to use a credit card or wire transfer, or accept PayPal transfers.

Using a credit card to buy Dogecoin is generally not recommended, as the transaction will be treated as a cash advance by your bank, attracting higher fees and interest rates.

Once you've deposited money into your account, you can then use it to purchase Dogecoin.

If you already own cryptocurrency, you may be able to trade it for Dogecoin. However, not all platforms allow this, and each platform is different in terms of what's allowed.

It's important to remember that investing in Dogecoin is risky, and you should only invest what you can afford to lose.

Placing your order

Once you have done your research and decided that Dogecoin is the right investment for you, you can follow these steps to place your order.

Step 1: Sign up for a crypto exchange

You will need to create an account on a well-known cryptocurrency exchange such as Coinbase, Kraken, Binance, Gemini, or Robinhood. You will need to provide information like your email address, name, and phone number.

Step 2: Verify your account

You will need to verify your account with personal details like proof of address. You may also need to undergo a Know Your Customer (KYC) verification process.

Step 3: Deposit funds to your account

You can deposit money into your cryptocurrency account through various methods, including bank transfer, credit or debit cards, and wire transfer. The bank transfer may take several days.

Step 4: Place your order for Dogecoin

On the exchange's trading or purchase platform, search for Dogecoin or enter its ticker symbol, DOGE. Then, decide whether you want to input the dollar amount you want to invest or specify how many Dogecoins you want to buy.

Step 5: Finalize your purchase

Review the details of your purchase and confirm the transaction. Your order should go through immediately.

Please note that your broker or crypto exchange may charge trading fees for buying or selling cryptocurrency, which can range from about 0.05% to 5% per trade. However, some investing apps like Robinhood and Webull offer commission-free crypto trades.

Storing your Dogecoin

Once you've bought Dogecoin, you'll need to store it. It's by default kept in your exchange's or brokerage's crypto wallet. However, because these wallets are generally connected to the internet, some investors prefer to withdraw their crypto and store it in another wallet.

There are two main types of crypto wallets: hot wallets and cold wallets. Hot wallets are digital and connected to the internet, while cold wallets are physical hardware that you can disconnect, making them much less susceptible to hacking. Cold wallets are generally considered to be the safest way to store crypto assets.

Ledger Nano S

A popular hardware wallet that boasts a number of security features, including secure PIN storage of your private keys, an easy-to-use backup and restore feature, and support for two-factor authentication. It supports the storage of more than 700 different cryptocurrencies.

Trezor One

A slightly cheaper hardware wallet option that is developed by SatoshiLabs, a trusted company based in the Czech Republic. The Trezor One supports Dogecoin and over 700 other tokens, and keeps your private keys on your device, making it difficult for hackers to access them through online connections.

Exodus Wallet

A popular and well-designed wallet in the crypto industry, Exodus is a multi-coin wallet that can be accessed on multiple devices and operating systems. It has built-in exchange functionality and supports a vast number of different tokens and coins, including Dogecoin. Exodus also has a partnership with Trezor, allowing users to harness the security of the Trezor device while enjoying the user-friendly Exodus interface.

Official Dogecoin Wallet

If you're committed to Dogecoin, the best way to store your coins is in the official Dogecoin wallet. The desktop version comes in a core wallet that downloads the entire blockchain and helps to secure the network, as well as a lite version called MultiDoge, which is suitable for simply storing and transferring Dogecoin. There is also a mobile version for Android devices. The official Dogecoin wallet is quick and easy to set up and use, but it lacks support for iOS and is only compatible with Dogecoin.

Dogechain Wallet

An online wallet that can be accessed from any browser. While this type of wallet is less secure, if you're only dealing with small amounts of Dogecoin, Dogechain is a solid choice. It encrypts everything, and your wallet information is never accessed by Dogechain. The encrypted files are stored in the cloud, so even if the Dogechain servers go down, you'll still be able to access your coins.

Paper Wallet

A physical paper wallet is a very secure way to store your cryptocurrencies. It's simply your private keys printed on a piece of paper, often with QR codes to make transferring coins easier. Paper wallets are not connected to the internet, so there is no way for a hacker to steal your coins. However, paper wallets are vulnerable to theft or destruction, so it's important to keep them in a safe place, such as a safe or a bank safe deposit box.

Frequently asked questions