Decoder: Is “Dogethereum” Another Joke? And What Does It Mean For Dogecoin?

Have you heard about Dogethereum? The bridge that will make Dogecoin compatible with the Ethereum network? It’s launching today! Oh wait, it’s not launching, it’s demo-ing. But it’s already caused a surge in Dogecoin’s value! Never mind, that value’s already dipped back down again.

As usual when it comes to cryptocurrency, there’s been a lot of hype (including an art project) surrounding a likely anticlimactic event—the demo of “Dogethereum,” a livestream test that started at 1pm EST on September 5. Those working on the project aim to create a “bridge” between the Dogecoin and Ethereum blockchains that would facilitate the movement of virtual Dogecoin tokens to Ethereum tokens, which holders can then move back to the Dogecoin blockchain.

This is exciting for people who think it will increase use cases for (and the value of) Dogecoin—an altcoin that was originally created as a joke referring to the famous Shiba Inu “much wow” meme—by connecting it to the widely and diversely used Ethereum network. On Reddit yesterday, one user predicted, “Everyone HODLing on tomorrow watching the Dogecoin value during the Dogethereum Bridge” would look like Seinfeld’s Kramer betting on a horse race. It’s also eliciting some yawns.

First, what is Dogecoin? And what does it have to do with that meme of a surprised Shiba Inu?

Jackson Palmer, an Australian transplant who currently lives in San Francisco and makes crypto-explainer YouTube videos, came up with the idea for Dogecoin in late 2013. At the time, new altcoins were debuting every other week and “would appear to essentially print money out of nowhere,” Palmer said in the Coloring Crypto podcast in February this year. That was the backdrop—the inspiration for the coin itself came from two tabs Palmer had open on his computer screen one day. In one tab, Palmer was reading a Gawker article about the Doge being the “purest” meme, and in the other tab he was checking altcoin market values on CoinMarketCap. Together, the tabs spelled “Dogecoin,” and a satirical altcoin was born.

Since then, Dogecoin experienced unexpected adoption—at least to Palmer. The price of one Dogecoin increased to over $0.001 in early 2014, and thanks to its quick popularity, Palmer and friends were able to raise $30,000 to help get the Jamaican bobsled team to the 2014 Winter Olympics. As of this writing, Dogecoin is ranked #21 with a price of roughly $0.005 on CoinMarketCap, the very site that inspired its existence.

What would a “bridge” between Dogecoin and Ethereum look like?

Such a bridge would allow transactions between Dogecoin and Ethereum without the need for an outside exchange. This would let dogecoin holders (also known as “shibes”) trade seamlessly for ERC-20 tokens, those used in the Ethereum network. This is a big deal because a lot of tokens are compatible with ERC-20, including EOS tokens, TRON, and even “adult industry” token SPANK.

A bridge between Dogecoin and Ethereum would therefore mean that the smart contracts used in the Ethereum network could also work with dogecoins. People (like this guy) like to compare this use case to a casino, where dogecoins are cash and ERC-20 compatible tokens are poker chips. After you exchange your cash for poker chips, you can always change those chips back to cash. Same idea with dogecoins and tokens on Ethereum once Dogethereum is up and running.

Why create Dogethereum?

There are the aforementioned reasons. And then there’s money.

In 2014, developers including Alex Van de Sande, a UX designer at Ethereum, put together a bounty that would go to the first person (or group of people) to create a way to move dogecoins to and from the Ethereum network. That bounty is currently worth around $270,000, creating real incentive for those at work on the bridge. TrueBit, which works on scalability solutions in the Ethereum blockchain, has been a player in this game for a while. Today’s demo comes from a group of developers working with CoinFabrik, a company that builds security applications (Van de Sande also showed up to watch and ask questions).

“We have been working hard for more than one year, but the community reaction is overwhelming,” developer Oscar Guindzberg, who led the demo today, told me over email. “We have certainly not expected this support.”

So, what’s next?

Depends on who you ask. Up until now, those working on Dogethereum have been able to move dogecoins over to the Ethereum token but not the other way around, which Palmer wrote to me in email “requires engineering work on the Dogecoin client itself which has not yet been released.” (The demo today included a way to move coins back from Ethereum to Dogecoin without modifying the Dogecoin client.) Though Palmer noted that “most people get angry” when he offers his two cents on Dogecoin (he sold all of his coin in 2015 and has removed himself from the project), he did tell me this:

“You won’t be running smart contracts on Dogecoin, and the Ethereum token is just like a regular ERC-20 token in many ways. Furthermore, transaction fees are higher on Ethereum so it’s actually more costly to use that token than just use regular Dogecoin. Bottom line: kinda cool tech demo, not very useful in reality.”

Leading up to the demo, the price of Dogecoin fluctuated, going way up in anticipation (to around $0.006 on September 1) and then quickly sliding back down.

The livestream of the demo is taking place as I write this, and the chat alongside the YouTube video is filling up with viewers urging each other to “buy now and retire your family,” “trust me buy now,” and “HODL” their dogecoin. Then I blinked. Now chatters are e-screaming to “sell.”

“I think I’m done with the cryptos,” one user wrote.

Per the chat, the scene is panning out to look a lot like that one Redditor predicted—filled with frantic bettors at a horse race—but it’s hard to say who the Kramer is.


This article has been updated to reflect that the Dogethereum demo included a way to move coins back from Ethereum to Dogecoin without modifying the Dogecoin client.