Couldn't this simply be a wallet held by an exchange managing a large number of customer's DOGE holdings?
If this was a long-term storage wallet, it would make sense for it to have steady deposits and few withdrawals (in big chunks, going into other "hot" wallets held by the exchange, from which withdrawals to individual customer withdrawals are sent).
Assuming they're solvent, the exchange has to hold DOGE backing up all their customers balances. Since many customers never withdraw into their own wallets -- especially for a short-term trading coin like this -- that balance managed by the exchange will be substantial and grow during times of high trading.
What I truly don't understand is how many people invest into BitCoin. There seems to be a complete disregard of its problems and its technical limitations. Why would they choose the "flawed prototype" for their investments?
I can only assume that they didn't read and learn enough about the subject before throwing money at it...
You could argue that even if it's flawed, BTC has at least some utility to it. DogeCoin on the other hand is a farce without any use for it, except making fools lighter in the pocket.
Apparently dogecoin is actually used on a variety of sites for legitimate purposes. but even so, 500+ percent increase in the past month and supported on major trading platforms doesn't seem foolish or making wallets lighter.
It could go down of course, it probably will but your statement is wrong on both accounts
That’s not a good criterion as ponzi schemes make a lot of people money investing in it. I think it’s important to evaluate financial trends based on first principles to understand if we’re just seeing a small window at the beginning of a scheme.
I was arguing that making money for investors is not a good criterion without more info. So doge having utility doesn’t deflate, but reinforces my argument.
How do you even cash out that amount of money? I think it is misleading to just multiply the number of coins with the market price for a small amount of coins. The purcasing power is likely to be a lot less than $1 billion.
Also, I imagine I got a ton of Dogecoins from speculation, mining, whatever. I just to go to my regular exchange and try to withdraw a million. Probably need to do a lot of extra KYC paperwork, but OK. But then, how do I convince the authorities that this is not some laundered crime money?
This is fascinating - not that someone owns a large percent, that's kind of easy if you've bought early. This guy though has been buying up over quite a recent time period though, so it's an expensive way to do it. The other thing that I find surprising is that this is concentrated in a single address, which means the person wants you to know that there is a single person with that proportion. It means if he starts moving money out it could easily cause a panic.
Literally anybody can spend a buck or so to send 69 doge to that address, and then use it to promote their pump-and-dump.
You can't tell that transfers into an address are done with the consent of the address owner at all, or that they represent "buying". The only activity that is provably initiated by the address owner are the transfers out, and none of those are meme amounts. In fact they're all to a single wallet. Probably the exchange's hot wallet.
yesterday just bought another 100M.
Is not an exchange, because don't sell just buy more a more. Exchange wallets are easy to detect looking to the massive amount of transactions.
It really is a distributed Ponzi. Kind of like the company MMM in Russia in the 90s, everybody knew it was a scam but people hoped they would get out before it collapsed and take profits from the later suckers.
The innovation of crypto in this space is that it makes the Ponzi scheme genuinely fair. Unlike MMM, there is no founder at the top who can run off with all the funds at once.
The scheme lasts until the last fool is found, the losses are distributed amongst the late arrivals (or early adopters with diamond hands) and the gains are distributed amongst the early adopters who sold high. There is nobody to go after as a criminal. Best of all, the "company" survives despite losing its value, and the cycle can repeat again in a few years. If you didn't get out this time, you can hope for another round of the game later on in which you can unload your position.
Doge coin is getting adopted as a Tip Currency. Pornhub already add that functionality, reddit and other websites. But yeah any currency can be seen as a ponzi. This one is just descentralized. 40% of all dollars in circulation were printed in 2020. At least doge "printing" is limited to 5B per year. Things have the value we want to give to them.
What technical property gives Doge an advantage over any other crypto for tipping?
Seems like the main advantage for tipping currency is small transaction fees -- i.e. you use Doge instead of BTC because with BTC, the current median fee is around $8, so it makes no sense to send somebody a $1 tip. But with Doge, it's much lower, like 4 cents. So it seems a lot better.
Except that the only reason fees are so low is that network usage is so low. By design, with 1MB blocks generated every minute, the doge network can only process something in the ballpark of 30-40 transactions per second (depending on transaction size). Currently it's not anywhere near that level of load. But as load approaches or exceeds that level, it will cost increasingly more to get your transaction included by a miner in the next block.
That's exactly why bitcoin fees are high and the only reason Doge isn't seeing the same problem is 1. it isn't that big yet, and 2. it has a faster block rate (every minute instead of every ten minutes) so it pushes the problem a bit further back, but still doesn't solve it. The more people use the coin, the worse using it gets.
If Doge was actually adopted widely for tipping -- which it isn't really right now -- it would see a huge increase in transaction volume and quickly become unsuitable for that purpose due to the increase in fees.
It's much more honest to simply tell people that it's going up and you can potentially get rich quick by buying low and selling to somebody else before the bubble pops again. Pretending Doge is actually going to be widely adopted as a medium of exchange is just sad.
If this was a long-term storage wallet, it would make sense for it to have steady deposits and few withdrawals (in big chunks, going into other "hot" wallets held by the exchange, from which withdrawals to individual customer withdrawals are sent).
Assuming they're solvent, the exchange has to hold DOGE backing up all their customers balances. Since many customers never withdraw into their own wallets -- especially for a short-term trading coin like this -- that balance managed by the exchange will be substantial and grow during times of high trading.