Elon Musk, CEO of Tesla and SpaceX, suggests improvements to cryptocurrency meme Dogecoin, but Vitalik Buterin, Ethereum co-founder, replies that his suggestions are not feasible because of security issues.
How Dogecoin came to be
Created as a meme a, Dogecoin has generated a lot of discussion in the market due to its strong growth,. However, most experts have pointed out that it could be a bubble, given that the price increase has no correlation with the asset.
Dogecoin was created by software engineers Billy Markus and Jackson Palmer in 2013. Palmer tweeted jokingly: “Investing in Dogecoin, pretty sure it’s the next big thing”.
After receiving several mentions on Twitter, Palmer decided to keep the joke going. He bought the Dogecoin.com domain and uploaded a photoshopped Shiba Inu on a coin.
He left a note on the site: If you want to make Dogecoin a reality, get in touch.
Markus saw and contacted Jackson Palmer and the two started to develop it together. On December 6, 2013 the “coin meme” was launched.
The site received more than one million visitors in the first 30 days. The two intended for Dogecoin cryptocurrency to be nothing more than fun. However, over the years, the community grew and it was difficult for them to preserve the initial idea. In 2018, Palmer told Decrypt that Dogecoin “was always like a hobby project, like a side project thing”
Dogecoin price continues to go up and has made many people rich, although the creators themselves are not part of the DOGE millionaires: “I made a lot of people rich but I didn’t come away with any money. I get to tell people that I created Dogecoin, which is fun.” The net worth of Dogecoin’s creators is unknown, as the two tend to stay out of the spotlight and social media.
Elon Musk vs. Vitalik Buterin
Now, two well-known names in the crypto community are discussing (and disagreeing) on the potential of this digital currency. While Tesla CEO Elon Musk continues to praise Dogecoin, Ethereum co-founder Vitalik Buterin has pointed out several problems with the asset.
Elon Musk continues to support Dogecoin
For some time now, Musk has praised Dogecoin. According to Musk, Dogecoin has the potential to even surpass Bitcoin, if some improvements are implemented in its network.
Responding to a comment comparing Dogecoin and Bitcoin on Twitter, Elon Musk said that the crypto meme could easily surpass the biggest cryptocurrency if “speeds up block time 10X, increases block size 10X & drops fee 100X. Then it wins hands down ”.
Ideally, Doge speeds up block time 10X, increases block size 10X & drops fee 100X. Then it wins hands down.
— Elon Musk (@elonmusk) May 16, 2021
Vitalik Buterin says that Musk’s plan is “fundamentally flawed”
Following Musk’s tweet, Vitalik Buterin wrote an article saying that he finds it difficult to carry out the suggested changes in the Dogecoin network. “But it’s going to take work to do this without sacrificing the decentralization that makes blockchains so valuable,” he says in the text.
According to Vitalik, implementing Musk’s proposals is not simple, mainly because of technical factors that affect the safety of a project like Dogecoin.
Vitalik explains that for a network to be truly secure it is necessary to maximize the number of users that can run a blockchain node.
In several of the main existing cryptocurrencies, the process of creating new assets is done through mining, in which computers solve mathematical problems to confirm operations and as a reward, new currencies are generated. For this to occur, it is necessary to complete a block, hence the name blockchain, and when this occurs, it is said that a “node” was executed.
Vitalik says Musk’s scalability proposal results in an increase in hardware requirements for validators, which in the end results in a movement opposite to this maximization of users who can run the node.
He explains that increasing the time and size of a block by 10 times, for example, would require bandwidth, storage and computational power to run a node that an ordinary user cannot afford.
Because of this, the forced scalability suggested by Musk would make the process viable only for larger and more specialized players, with better and more expensive equipment. Vitalik, therefore, says that this “is not a solution”.
“For a blockchain to be decentralized, it’s crucially important for regular users to be able to run a node, and to have a culture where running nodes is a common activity,” he wrote in the article.
Vitalik defends Ethereum security practices
In the article, Vitalik mentions the example of Ethereum as an example of how to solve challenges of scalability. The Ether token network relies on a solution called sharding, or block fragmentation, that separates the data from the blockchain instead of centralizing everything on a single node, facilitating the validation of transactions.
Even so, he explains that, in the case of Ethereum: “Consequently, it appears that in both dimensions, the Ethereum fragmentation design is actually already very close to reasonable maximum safety values. The constants can be increased a little, but not a lot”.
Recently, the Ethereum network has undergone exactly an update to help with its security and system improvements, with more news expected for July.
Musk’s answer to Vitalik’s article
Last Monday (May 24), Musk wrote a reply on his Twitter, satirizing Vitalik’s article, saying that the developer is afraid of Dogecoin and its alleged advantage over other cryptocurrencies.
He fears the … pic.twitter.com/78WzM5ICjA
— Elon Musk (@elonmusk) May 24, 2021
Tesla’s CEO recently said he is working with Dogecoin developers to find improvements and solutions to evolve the cryptocurrency.
Despite the recent strong rally and the support of names like Musk, experts warn that Dogecoin lacks fundaments to support its rally and that investors be wary of the coin.
Musk himself, although enthusiastic, has so far made no concrete proposals or any clearer signs of what can be done to improve Dogecoin network.
On the other hand, Musk has been playing a lot of games on social media, like participating in the Saturday Night Live program under the name “Dogefather“. Musk also announced that SpaceX will accept Dogecoin to launch lunar mission in 2022, with the rocket named DOGE-1.
