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Dogecoin ( DOGE -1.47% ) is already beating Bitcoin ( BTC -0.76% ) in some ways. In others, the digital coin with the adorable dog mascot is miles and miles behind the largest and oldest cryptocurrency. Moreover, the technical platforms are quite similar since Doge is a distant descendant of the Bitcoin system -- with some tweaks along the way.

After coasting along with minor price gains over several years, Dogecoin entered the spotlight during the social media whirlwind of early 2021. Coin prices have retreated a long way from the peak of that craze, but Dogecoin still outperformed Bitcoin over the last two years:

Dogecoin Price data by YCharts.

Is Dogecoin poised to kick Bitcoin off the crypto-sector's throne in the long run?

First, let's have a short history lesson.

Bitcoin was arguably the first cryptocurrency on the planet. Based on a 2008 white paper by a still-unknown author by the code name Satoshi Nakamoto, the first Bitcoin block was mined in 2009 and the first commercial transaction took place the next year. Back then, 10,000 Bitcoins bought two pizzas -- a transaction that would be worth $4.1 million at today's Bitcoin prices.

Many enthusiasts mined Bitcoin with their own computers and graphics cards, at first. It wasn't long before specialized Bitcoin mining semiconductors appeared on the market, ripping through the mining algorithms at speeds that even the best PC hardware couldn't match. In response to this mining issue, Litecoin ( LTC -1.76% ) was created in 2011 as a payments-focused Bitcoin clone with a couple of key tweaks.

This cryptocurrency uses a different mining algorithm known as scrypt, a deliberate choice that makes it better suited for ordinary computer systems. Furthermore, Litecoin's technical parameters are different, resulting in faster transaction settlements and a lifetime maximum of 84 million coins versus 21 million for Bitcoin. The downside to these efficiency improvements is a less ironclad security system that might be easier to hack.

Next in this heritage chain was Junkcoin, an experimental offspring of Litecoin that stuck with the PC-friendly scrypt system and raised the number of total coins. Luckycoin followed as a Junkcoin clone, boosting the coin cap even further. These days, Litecoin remains a serious cryptocurrency, but the Junkcoin and Luckycoin stepping stones are mere footnotes in cryptocurrency history.

Finally, Dogecoin began life in 2013 as a tweaked clone of Luckycoin. We're still looking at the scrypt mining algorithm, but the cap on lifetime coin production is gone. Each new Dogecoin block is also rewarded with 10,000 new tokens, compared to 50 Litecoins or 6.25 Bitcoins per freshly mined block of those cryptocurrencies.

Here's what we have after that step-by-step chain of cryptocurrency evolution.

Bitcoin is a dead-serious cryptocurrency, designed as a secure system for the long-term store of value. You can also pay for things with this digital coin, but money transfers take a while and come with significant transaction fees. Today, Bitcoin's total market value stands at $868 billion and the price per coin is approximately $41,300.

In the other corner, Dogecoin was originally launched as a joke between two programmers with no real long-term goals and ambitions. The technical tweaks have created a more nimble system for digital payments with faster and cheaper transactions, but at the cost of weaker data security. The lack of a hard cap on the number of Dogecoin tokens also points to massive inflation in the long run. Dogecoin's market value adds up to $18.9 billion at a price of $0.14 per coin.

Bitcoin miners have to use specialized chips because PC processors and graphics cards simply can't compete against chips specially designed to process the underlying SHA-256 encryption routine. Dogecoin's scrypt system is more inviting to ordinary hardware with a large supply of memory chips, so it's a better choice for crypto-mining enthusiasts with fast graphics cards.

Image source: Getty Images.

At the end of the day, these two cryptocurrencies have a lot of shared DNA and history but are very different when it comes to real-world utility. If anything, Dogecoin could challenge Litecoin or Ripple as an efficient money-transfer platform, but even that ambition seems to fall short when you consider Dogecoin's incoming inflation and its lighter focus on data security.

The coin has one more thing going for it, and that's the lighthearted marketing message with microscopic coin prices and a cute mascot. In the hands of a master marketer, that could be enough to create a cryptocurrency with long-term value. Maybe. Perhaps. You never know.

But Dogecoin will never take Bitcoin's place in the cryptocurrency universe because that was never the plan in the first place.

This article represents the opinion of the writer, who may disagree with the official recommendation position of a Motley Fool premium advisory service. Were motley! Questioning an investing thesis even one of our own helps us all think critically about investing and make decisions that help us become smarter, happier, and richer.

Excerpt from:
Is Dogecoin the Next Bitcoin? - The Motley Fool

Visa V and Mastercard MA , two of the world's biggest payment processors, have come under pressure from bitcoin, ethereum and decentralized finance (DeFi) projects over the last yearwith Tesla billionaire Elon Musk and others speculating dogecoin could "truly be the future currency of the internet."

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The bitcoin, ethereum and crypto price boompushing the combined crypto market to around $2 trillion from under $500 billion in just 18 monthshas sparked a wave of blockchain-based development, including in high-tech ethereum rivals such as solana and cardano.

Now, Chamath Palihapitiya, a former Facebook executive who runs the venture capital fund Social Capital, has warned there's "a swarm of activity [coming] to dismantle" Visa and Mastercard.

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Chamath Palihapitiya, a former Facebook executive-turned venture capital investor, has long backed ... [+] bitcoin and other blockchain-based projects such as ethereum and its rivals solana and cardano even ahead of their price boom.

"Visa and Mastercard, I think, are doing the single dumbest thing they could do, by being a duopolywhich is raising prices, especially into an inflationary moment, which just lacks complete knowledge and sensitivity of the moment," Palihapitiya said, speaking on the latest episode of the All-In Podcast. Visa and Mastercard are preparing to increase merchant fees, it was reported by the Wall Street Journal last month.

"This week, I was able to see a little bit under the hood of Solana Pay, and that's really exciting," said Palihapitiya, who's gained a reputation over the last couple of years as the "SPAC king" for his successful sponsorship of blank-check funds, or special purpose acquisition companies (SPAC), that raise money in the public markets to buy private companies. "So it's all coming, I think. It's like a swarm of activity to dismantle these payments businesses."

Solana Pay, a digital payment platform that runs on top of the solana blockchain network and can support a range of digital assets such as NFTs, claims to be able to compete with Visa and Mastercard in terms of transactions per second. While bitcoin, without additions such as the Lightning Network, averages just seven transactions per second and ethereum averages only thirteen, solana boasts 65,000 transactions per second without the need for a third-party such as a bank or payments processor.

Late last year, Palihapitiya, who abruptly resigned from his position as the chair of the Virgin Galactic board in February, predicted Visa and MasterCard would be the "biggest business loser[s] in 2022" calling the pair a "completely contrived duopoly that doesn't need to exist."

"Be short these companies and anybody that basically lives off of this 2% or 3% (transaction) tax, and be long well-thought-out, web3 crypto projects that are rebuilding payments infrastructure in a completely decentralized way," he said.

While solana is a decentralized network, it has sacrificed a high degree of decentralization for increased transaction speeds and low fees. Solana has suffered several outages and periods of transaction congestion in recent months, somewhat casting doubt over the blockchain's ability to scale to the same level as bitcoin and ethereum.

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The solana price has rocketed higher since it was launched in 2019, outpacing the likes of bitcoin, ... [+] ethereum, XRP, cardano and other cryptocurrencies over a similar timeline.

However, earlier this year, analysts at Bank of America predicted solana could win a significant amount of market share from ethereum and become the "Visa of the digital asset ecosystem."

"[Solanas] ability to provide high throughput, low cost and ease of use, creates a blockchain optimized for consumer use cases like micropayments, DeFi, NFTs, decentralized networks (web3) and gaming," Bank of America analyst Alkesh Shah wrote in the note to clients.

The crypto market has bounced back this week after a sudden sell-off over the weekend, with the bitcoin price climbing back over the closely-watched $40,000 per bitcoin level.

Solana has led the crypto price rally, climbing 5% over the last 24 hours. The ethereum price has meanwhile shot back over $3,000 per ether.

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Single Dumbest Thing They Could DoSPAC King Issues Stark Visa And Mastercard Crypto Warning As The Price Of Bitcoin, Ethereum, BNB, XRP, Solana And...

Bitcoin has the potential to challenge 18th-century monetary defensive protocols as a 21st-century modern monetary defense protocol (MMDP) alternative. For starters, the purpose of any defensive protocol is to provide natural barriers which are designed to increase safety and maximize security. So, the stronger the protocol, the superior protection and the security it provides.

The U.S. Constitution, for example, is a defensive protocol that was constructed to protect individual liberties while also outlining the limitations of the people defined for their government. This masterpiece of a defensive protocol is truly a revolutionary document that helped propel civilization forward in ways never experienced before in history. Furthermore, the U.S. eventually established the Department of Defense (not the Department of Offense) as an insurance policy to further defend our way of life. That being said, the right defensive protocol has the potential to shape the future and pave the way forward in ways we cannot fathom at this given moment in time.

Now, built into the countrys defensive protocol under Article 1 Section 10, one will find the nations monetary defensive protocol. This 18th-century monetary defensive protocol attempts to limit the government's ability to spend by decreeing the nation's debts will be paid using gold and silver. As we may have learned, history doesnt repeat itself, but it often rhymes and the nations founders were very aware of the inherent dangers of overextending the countrys obligations through a debased money supply. After all, what is history but a societal pendulum swing that starts with quality money (gold and silver) to quantity currency (debased currency) and then back to quality money again. Up until very recently, gold and silver have been the best defensive monetary protocol against runaway inflation and currency debasement. To this day, gold and silver still plays a key role as an insurance policy as virtually every country holds a significant cache in their reserves.

Currently, our 18th-century defensive monetary protocol remains highly valuable, which is why it is heavily protected by a well-trained and experienced 21st-century military hired by the Department of Defense using highly effective 20th-century tactics. Fort Knox, which reportedly holds the nations gold, is guarded with thick granite walls and blast-proof doors that weigh over 20 tons. It is surrounded with 24-hour per-day, seven-day per-week surveillance, guards positioned in several sentinel stations, a perimeter fence equipped with motion sensors, an electric fence that is a second barrier protecting the installation and the Appalachian Mountains to the east, which provides a natural barrier against potential adversaries. If additional military protection is ever needed, available soldiers, tanks, attack helicopters and artillery are located at the Fort Knox military base nearby. All to say, that is a significant amount of firepower designed to defend the nation's current monetary defense protocol.

For context purposes, gold has been used as the supreme monetary tool to store the value of our goods and build wealth in order to advance civilization for thousands of years. Gold's natural chemical makeup, its indestructible properties, combined with its scarce supply made it the most sound money human beings have discovered. Its use propelled the development of human societies as it transformed a world of bartering to a world of international trade consisting of cutting-edge technological breakthroughs. The possession of gold, although it has an excellent track record as quality money, has repeatedly led to the destruction of civilization and a historical loop that always seems to repeat itself.

The inherent traits of our species, specifically violence and greed, unfortunately always seem to manage to corrupt the money supply. Removing the corruptible and inherently violent nature of human beings from the money supply and instead outsourcing oversight to a line of code may be a viable alternative and solution to a 5,000-year-old problem. Only when civilization discovers this so-called perfect incorruptible money in Bitcoin can it have the opportunity to bring the type of peace that politicians and those alike claim they want to achieve. Now, instead of hiring an army to defend an 18th-century monetary protocol, the Bitcoin network elevates us into the 21st century and uses the power of electricity as a defense system.

That being said, MMDP (otherwise known as the Bitcoin network) is a 21st-century solution to an 18th-century problem and quite possibly a contender to replace inferior monetary defensive protocols in order to maximize the protection of individual rights, while simultaneously preventing irresponsible spending. Sooner or later, MMDP will eventually become a national security priority and the leaders of our nation will come to the realization that safeguarding MMDP may become as much of a national security priority, if not more, as safeguarding an arguably outdated 18th-century monetary protocol. If that turns out to be the case, then it would not be unlikely to see the Department of Defense begin to quickly transcend its dominant role from a 20th-century standpoint and transition to a 21st-century defensive posture as civilization transitions from physical monetary defense to digital monetary defense in and through cyberspace via the power of electricity and storing monetary energy with Bitcoin.

This is a guest post by Matthew Smith. Opinions expressed are entirely their own and do not necessarily reflect those of BTC Inc. or Bitcoin Magazine.

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Bitcoin Is The Modern Monetary Defense Protocol - Bitcoin Magazine

Silvergate Capital Corporation (NYSE: SI) saw customers deposit an average of $14.7 billion worth of bitcoin and cryptocurrency to the firms platform during the first quarter of this year, up from $13.3 billion during Q4 2021, the company said in its quarterly results report released Tuesday.

We started off 2022 on a strong note, driven by the power of our platform and continued progress on our strategic initiatives, said Alan Lane, president and CEO of Silvergate, in a statement.

As the company positions itself as a viable banking solution for holders of and service providers for assets like bitcoin, the increasing number of customers utilizing the Silvergate Exchange Network (SEN) continues to showcase the market demand from institutional buyers. SEN had over 1,500 customers by the end of last month, Silvergate said, a 27% increase year-over-year as the platform had a little over 1,100 clients in March 31, 2021.

SEN enables real-time U.S. dollar and euro settlement between counterparties, in addition to faster trading, automated funds distribution, and data analysis. Its clients include FTX, Coinbase, Bitstamp, Kraken, and the company behind the USDC stablecoin, Circle.

Im particularly pleased with our first quarter results when you consider that this was one of the most challenging periods for the broader crypto ecosystem since the beginning of the pandemic, Lane said.

A cautious cryptocurrency market resulted in a 35% decrease of U.S. dollar transfers on SEN, bringing Q4 2021 numbers of $219.2 billion down to $142.3 billion during Q1 2022. The platform also saw an year-over-year (YoY) downturn, 15%, as Q1 2021 witnessed $166.5 billion in transactions. Cumulative U.S. dollar transfers on the SEN have now crossed $1 trillion dollars

While volume on the Silvergate Exchange Network was impacted by broader industry trends, I remain encouraged by the continued growth we saw in customers, SEN Leverage commitments, and average deposits, which reached a record $14.7 billion, Lane explained.

Net income and customer acquisition both saw an increase, but SEN Leverage positions noted the biggest growth. While the metric sit at $570.5 million during Q4 2021, it teleported to $1.7 billion in commitments at the end of Q1 2022. Over the past one year, SEN Leverage commitments denoted an increase of over 400%.

Silvergate also announced the acquisition of select technology assets from Diem, the failed stablecoin project from Meta Platforms.

To advance our customer-first approach, we continued to invest in our strategic initiatives, including stablecoin infrastructure through the acquisition of select blockchain-based payment technology assets from the Diem Group, and the launch of the Euro SEN, Lane said.

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Silvergate Bank Saw Over $14 Billion in Bitcoin, Crypto Deposited In Q1 2022 - Bitcoin Magazine