- Dogecoin mining involves solving complex computational problems, as it works based on the Proof-of-Work (PoW) consensus mechanism and uses the Scrypt hashing algorithm.
- You need to have hardware equipment such as ASICs and software programs like MultiMiner, and a Dogecoin wallet to start mining Dogecoins.
Dogecoin is one of those remarkable cryptocurrencies that brought a whole new revolution of meme coins into the industry. Even though it started as a joke, over time, Dogecoin gained a lot of traction and adoption from crypto communities. And, made it to the list of top 10 cryptocurrencies today. As a result, Dogecoin mining also started to take off in the last couple of years.
Unlike most of the meme coins that are existing today, Dogecoin was not created as an ERC-20 token. The Dogecoin protocol was developed by taking inspiration from existing cryptocurrencies such as Luckycoin and Litecoin. So, mining of DOGE coins works based on the traditional Proof-of-Work (PoW) consensus mechanism.
However, mining DOGE coins is not as difficult as mining Bitcoin. And, it rewards handsomely compared to other cryptocurrencies that rely on the PoW mechanism. Let us learn what Dogecoin mining is and how you can start mining Dogecoin, in the present article.
Brief History of Dogecoin Creation
Two software engineers Jackson Palmer and Billy Markus created Dogecoin as a joke to mock cryptocurrencies. Palmer bought Dogecoin.com domain and together they designed Dogecoin’s protocol based on Luckycoin and Litecoin cryptocurrencies. As these two cryptocurrencies work based on the Proof-of-Work (PoW) mining method, Dogecoin follows the same method.
Two weeks after Dogecoin was launched in December, 2013, DOGE price rose by over 300% within 3 days. However, when it suffered a price crash, so did the mining process. Large mining protocols took advantage of the small mining power requirements of Dogecoin.
With the support of popular influential figures such as Elon Musk, Mark Cuban, Snoop Dogg, and others, Dogecoin came back strong and reached its peak in the 2021 crypto bull run. As more and more investors and Dogecoin proponents joined Dogecoin mining, it resulted in an increased mining profitability in 2021.
How Does Dogecoin Mining Work?
As we mentioned, Dogecoin mining works based on the traditional Proof-of-Work (PoW) consensus mechanism. Crypto mining involves miners who compete with each other to solve complex mathematical problems and add blocks to the existing blockchain network. In exchange for successfully validating the next block, they will receive new cryptocurrencies as a reward.
Dogecoin was a hard fork of Luckycoin and Litecoin, which are in turn hard forks of the OG of cryptocurrencies, Bitcoin. So, it is natural for Dogecoin to follow the Proof-of-Work mining method to reach consensus between miners or participants. However, the underlying hashing algorithm of Bitcoin and its successors, including Dogecoin, is different.
Bitcoin Vs Litecoin Vs Dogecoin Mining
Bitcoin uses the SHA-256 hashing algorithm, which is more complex and requires a lot of computation power to mine new blocks. On the other hand, Litecoin and Dogecoin use the “Scrypt” hashing algorithm, which is less complex and enables faster computation. Adding to that, the computational power, aka the hash rate, is significantly less for Dogecoin compared to Bitcoin.
The block time, which is the time at which new blocks are added to the blockchain network, is also less in Dogecoin compared to Bitcoin and Litecoin. Dogecoin mining enables you to mine a new block for every 1 minute, while Bitcoin’s block time is 10 minutes and Litecoin’s block time is 2.5 minutes. The mining difficulty is also less in Dogecoin mining compared to others.
However, one concerning thing about Dogecoin is it has an infinite supply. While Bitcoin has a limited 21 million supply, Litecoin has 84 million token supply. Additionally, for successfully mining Dogecoin, you can get 10,000 DOGE coins as a block reward, which is significantly more than Bitcoin and Litecoin.
The usage of a similar hashing algorithm allows miners to “merge-mine” both Litecoin and Dogecoin. This implies miners can simultaneously mine both Litecoin and Dogecoin and there will be no negative impacts on the performance of mining and earning rewards.
How to Start Mining Dogecoin?
Since Dogecoin is not based on the SHA-256 hashing algorithm, you must avoid using SHA-256 mining equipment to mine Dogecoins. You need a dedicated field-programmable gate array and ASICs (Application Specific Integrated Circuits) to start mining Dogecoin.
As with the case of other cryptocurrencies that work on PoW, Dogecoin mining was also much easier at the beginning since there were very few miners. As the coin’s popularity increased, so did the number of people mining Dogecoin and its mining difficulty. This resulted in mining pools, where miners combine their computational power to increase the chances of mining the next block. You can start mining Dogecoin in the following ways, based on your convenience and preferences.
Solo mining involves mining Dogecoin independently. Dogecoin is one of the easiest cryptocurrencies to mine at home with simple hardware equipment such as GPUs and software programs, such as EasyMiner. You need to join the Dogecoin network as an individual node and start solving the computational problems. If you successfully mine the next block and add it to the network, you will receive 10,000 DOGE coins as a reward.
However, mining DOGE coins can be difficult as a solo miner, especially if you are a beginner. You need to compete with large mining pools and even if you manage to get a block reward, there is no guarantee that you will receive rewards consistently. Joining a mining pool is the solution for this problem.
Mining Pools involve a group of miners who combine their computational power to increase the probability of gaining mining rewards. This is a flexible mining method compared to solo mining.
When the mining pool successfully solves the computational problem and mines the new block, each member of the pool will get a share of the block reward. The share of your block reward depends on your contribution to the total computational power.
Some of the popular Dogecoin mining pools are Aikapool, Hashwiz, Litecoinpool, Zpool, etc. Joining a mining pool involves you paying some fees at the beginning. Also, you need to verify the specifications and conditions before joining a mining pool and ensure the legitimacy of the pool. Even though you receive a share of the total reward, there is a possibility that you get rewards consistently.
Dogecoin Cloud Mining
You can also mine Dogecoin through advanced mining methods such as cloud mining. If you are interested in Dogecoin mining and cannot afford buying hardware or software equipment, and joining a mining pool, you can rent computational resources from cloud mining platforms and start mining Dogecoin.
Cloud mining platforms help you mine Dogecoin by renting their computational resources for the agreed-upon time period. The advanced cloud mining technology makes the transfer of computational power possible. It is also as effective as joining a mining pool. Additionally, you do not need to own any special equipment and bear maintenance costs. But, you need to pay charges for utilizing their computational resources on a monthly or annual basis.
3 Things You Need to Start Mining Dogecoin
Mining process of any cryptocurrency involves hardware and software equipment, so do the Dogecoin mining. Now that you know different types of Dogecoin mining, let us also learn what are the things you need to have to start mining Dogecoin.
Dogecoin Mining Hardware
You can use different types of hardware equipment to start mining Dogecoin. You can either use a central processing unit (CPU), a graphics processing unit (GPU), or an application specific integrated circuits (ASICs).
Dogecoin Mining with CPUs
You can mine Dogecoins using CPUs of your PCs and desktops. However, it is not a recommended method as it involves overheating of your equipment and does not often lead to success. Theoretically, you can use CPUs to mine Dogecoin but practically it is not a viable option.
Dogecoin Mining with GPUs
Using GPUs to mine Dogecoin is a better option compared to using CPUs. However, this method also may not give your desired results when it comes to earning rewards. The increasing popularity of Dogecoin and its mining made GPU mining difficult over the years.
Dogecoin Mining with ASICs
Using ASICs to mine Dogecoin is the best option among the three. As their name suggests, ASICs are specifically designed for the purpose of mining and have become popular in Bitcoin mining over the years. ASICs help you mine Dogecoins efficiently and increase the chances of earning DOGE coin rewards.
However, if you own an ASIC for Bitcoin mining, you cannot use it for Dogecoin mining. As we mentioned, the underlying hashing algorithm of Bitcoin and Dogecoin are different. If you own an ASIC for Litecoin mining, you can absolutely use it for Dogecoin mining, as both of them have a similar hashing algorithm. Moreover, you can simultaneously mine both Litecoin and Dogecoin at the same time.
Dogecoin Mining Software
After deciding which hardware equipment you would like to use for Dogecoin mining, you need to set up a software program. Though there are different types of software programs that will help you mine Dogecoin, you need to choose the one that suits you hardware equipment.
While CPU equipment is compatible with CPU Miner or Pooler software, GPU miners require software programs like EasyMiner, CudaMiner, CGMiner, etc. All the software programs used for GPUs can also be used for ASICs. But, experienced miners prefer MultiMiner software for ASIC mining equipment.
When you set up both hardware and software equipment, you can start mining Dogecoins. However, if you managed to successfully mine blocks and earn a reward, where will you receive DOGE coins? For this purpose, you must own a crypto wallet that supports Dogecoin.
There are different types of crypto wallets to store Dogecoin, each with its own pros and cons. Let us go through some popular types of crypto wallets to help you choose the one suitable for you.
Hot crypto wallets
Crypto wallets that are connected to the internet are called hot crypto wallets. They not only help you buy, send, and store cryptocurrencies but also allows you to easily access them. If convenience and flexibility to access your Dogecoins is your preference, then hot crypto wallets are the right choice for you. Some of the hot crypto wallets include Coinbase wallet and MetaMask wallet.
Cold crypto wallets
Crypto wallets that are not connected to the internet are called cold crypto wallets. Among different types of cold crypto wallets, hardware wallets like Ledger are popular. After you receive Dogecoin rewards, you can send them to your cold crypto wallet.
Everytime you would like to access your Dogecoins, you need to connect your cold crypto wallet to an internet-connected device, which is a bit complex compared to hot wallets. But, if securely storing your hard earned Dogecoin is your priority, then cold wallets are the best option for you. Some of the crypto cold wallets include Ledger Nano X and Trezor Model T.
Dogecoin mining has evolved over the years just like the evolution of the entire crypto industry. Most people assume that Dogecoin is an ERC-20 token, because most of the meme coins are ERC-20 tokens, which is untrue. Dogecoin emerged from Bitcoin and is traditionally mined to get new DOGE coins into circulation.
With the help of the present guide, you can start mining Dogecoins without any hassle. Before choosing any hardware or software equipment, ensure you research and understand the specifications and limitations. Select a crypto wallet based on your preferences and start mining Dogecoin today!
Frequently Asked Questions (FAQs)
Yes, new DOGE coins come into circulation only through the process of mining.
It takes around 1 minute to mine a new block of the Dogecoin blockchain network. For each block mined, miners will get 10,000 DOGE coins as a reward.
Over 1.44 million Dogecoins are mined per day because for every minute, a new block is mined, which produces 10,000 new DOGE coins.