Dogecoin vs. Bitcoin: How Do They Compare?

Bitcoin and Dogecoin are both among the best-known cryptocurrencies. Bitcoin has the distinction of being the first cryptocurrency, while Dogecoin was started seemingly as a joke. These two digital currencies, as blockchain-based digital assets, have similarities and also several notable differences.

Keep reading for a closer look at Dogecoin vs. Bitcoin. Find out the cryptocurrencies’ major similarities and differences that may influence your choices as an investor.

What’s the Difference Between Dogecoin and Bitcoin? 

Bitcoin is the original cryptocurrency, while Dogecoin was founded five years later and uses some of Bitcoin’s original code.Here are several critical differences between Dogecoin and Bitcoin:

Market Capitalization

Bitcoin’s market capitalization—its coin price times the number of coins outstanding—is about 47 times larger than the market capitalization of Dogecoin. Bitcoin has many fewer coins outstanding but a much higher coin price.

Bitcoin’s price reached over $60,000 in 2021. Dogecoin was worth less than $0.01 going into 2021, before briefly peaking at more than $0.60 in May of that year. A single Bitcoin carries a five-figure price tag, while Dogecoin trades for about $0.15.

Transaction Times

Dogecoin outshines Bitcoin when it comes to transaction processing times. Dogecoin averages around one minute to add a new block of transactions to the Dogecoin blockchain, making the Dogecoin network more than nine times faster at processing transactions than Bitcoin.

The Bitcoin blockchain is generally more popular, making Bitcoin more likely than Dogecoin to experience network congestion.

Transaction Fees

The cost of processing a Bitcoin transaction is significantly higher than the Dogecoin transaction processing fee. In the six months leading up to February 2022, the processing fee for a Bitcoin transaction ranged from $1.25 to $5.00, while the range for Dogecoin transactions was $0.10 to $1.75.

Dogecoin and Bitcoin also use different transaction fee structures. Bitcoin users have the option of paying a higher fee for a transaction to be processed faster, with the same fee charged regardless of the value of the transaction. Dogecoin transaction fees are charged based on a transaction's size in kilobytes of data, with 0.01 DOGE charged per kilobyte.

Special Feature

Bitcoin, as the first cryptocurrency, can be considered as a significant innovation—while Dogecoin is the most fun. 

Dogecoin is the “fun and friendly internet currency” that is “favored by Shiba Inus worldwide.” The Shiba Inu dog meme is synonymous with Dogecoin. The popularity of Dogecoin has additionally inspired imitators such as the Shiba Inu cryptocurrency.

Bitcoin was created as a “purely peer-to-peer version of electronic cash” that facilitates financial transactions without the need for any intermediary or centralized authority. Bitcoin is akin to digital gold, with a limited coin supply and a “mining” process to mint new bitcoins. Bitcoin mining is energy-intensive just like mining for physical gold.

Is Bitcoin or Dogecoin Right for You?

You can choose to invest in Bitcoin or Dogecoin, or both. You can choose to not invest in either. Bitcoin and Dogecoin are both risky assets, although Dogecoin may be a riskier investment than Bitcoin.

More conservative investors may opt to only buy Bitcoin, while those with a high-risk appetite may choose to add Dogecoin to their crypto portfolios. Investors should understand the risks and potential benefits before investing in any digital currency.

The Bottom Line

Bitcoin and Dogecoin rely on similar blockchain software, but their many unique features set them apart. Dogecoin stands out for its fast processing times and low transaction costs, while Bitcoin is the market leader that commands the most value. Depending on your investment goals and preferences, you may decide to invest in Bitcoin, Dogecoin, or both.