Deflationary Model for Dogecoin: Possible with Community Consensus?

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by Giorgi Kostiuk

2 years ago

Dogecoin co-founder Billy Markus has suggested a possible shift to a deflationary model for Dogecoin if the community and miners support the change.

Possibility of a Deflationary Model for Dogecoin

Billy Markus has shared on GitHub the potential for Dogecoin to adopt a deflationary model. Currently, Dogecoin follows an inflationary model, adding 5 billion DOGE annually through mining. Markus emphasized that a deflationary transition is possible only with community and miner support, with the relevant code available on GitHub.

Comparison Between Dogecoin and Bitcoin

Markus defends Dogecoin's inflationary model by comparing it to Bitcoin's flexibility within its community. He noted that both Dogecoin and Bitcoin could theoretically alter their supplies based on community consensus. Even though Bitcoin’s supply is capped at 21 million, changes could occur if the community and miners agree.

Support from Elon Musk and Dogecoin's Stability

Well-known Dogecoin supporter Elon Musk agreed with Markus, arguing that meme coin inflation is beneficial. Musk highlighted that Dogecoin has 'flat inflation,' implying decreasing percentage inflation over time. He added that reliance on an inflationary fiat currency with varying prices undermines its transaction reliability, while Dogecoin remains predictably stable.

The choice between a deflationary and an inflationary model will be decided by the community. Markus has already released the deflationary code on GitHub, and if supported, Dogecoin may implement it.

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