You probably wouldn’t have guessed that a co-founder of Dogecoin works as a full-time marketing product manager at Adobe, but today we’re talking to him. Jackson Palmer gives us all the details behind how digital currency works in an easy-to-understand way, and tells us how Dogecoin started as a Twitter joke but ballooned into a currency worth $30 million with an incredible community behind it.
How combining two viral elements as a joke on Twitter led to a living & breathing economy
A little over a year ago, Bitcoin was getting a lot of press (good and bad), and the currency’s value was bouncing all over the place. Needless to say, it got a lot of media attention and became a household name for a while.
Around that same time, Jackson read a blog post on Gawker by Adrian Chen about how Doge was the meme of the year.
He put two and two together, blasted it out to his Twitter following, and said, “The rest, as they say, is history.”
First, a little background on how digital currency works
“Just think of it as a digitized credit,” says Jackson.
But it’s a little different than how online banks and services like PayPal – if one of these gets hacked and goes down, the whole system gets messed up.
In crypto currency, blockchain technology is utilized to create a massive public ledger of every transaction that’s ever taken place on that currency’s network – and it’s hosted on every single device that has a record of a balance in that currency. So if one gets hacked, the rest of the network can still carry on business as usual.
The difference here between regular currency systems and digital currency systems is that digital currencies are decentralized, and the public ledger (now around 30 GB for Bitcoin) gets updated every 10 minutes.
When you open an account for Bitcoin or any other digital currency, you get a long stream that is your public key. (This can also be represented by a QR code.) Anyone who wants to can send money to your public key, but since you have the password to it, you control what goes in and how it gets managed.
There is a small fee for transactions, but it’s minor in comparison to the PayPals and Western Unions, who kind of have a monopoly on the money transfer industry. The fee goes to the data miners, who are the ones powering the public ledger updates – when a miner successful pushes through an update, they get rewarded with some of the currency.
How digital currency is resistant to corruption
With such a steady, decentralized infrastructure, no one person (even the creators) could be able to abuse digital currency for their own gain.
If a developer wanted to change the code on how a digital currency worked, said Jackson, they would have to get more than 51% of the network to agree to it.
The backstory behind Dogecoin’s beginnings
After the tweet went out and gained a little bit of popularity, Jackson’s co-founder got in touch with him because he’d figured out a way to change the Bitcoin code to make the font Comic Sans – which matched the doge perfectly, because it was always present in the memes.
Jackson said it only took them a few hours to put together and launch a web page, and they went ahead and did it even though they only thought the hype would last for three days.
“It took us by shock when it grew,” said Jackson.
How Dogecoin’s community grew it to a $30 million economy
Even though Bitcoin got a bad rap for being associated with the silk road and drug scandals, Dogecoin didn’t really have those problems because from the start it was a project that never took itself too seriously.
Jackson said Dogecoin appealed to a different demographic than Bitcoin – they saw a lot of younger people and women who weren’t necessarily interested in touching Bitcoin, but did have enough curiosity to play around with funny money online.
What really helped Dogecoin grow, though, was a bot that was developed about 10 days into the currency’s life that let people send online tips with Dogecoin.
The concept was that instead of just hitting a ‘like’ on a certain comment or piece of content, you could add more value to that ‘like’ by sending approximately $1 to the author.
People liked the idea so much that they started tipping their friends who had never heard of Dogecoin, so it created a sort of in-built virality.
Today the Dogecoin community is worth $30 million, but with the fluctuating price of Bitcoin, it’s been worth as much as $60 million.
Real-life examples of Dogecoin use: buying & donating
Outside of the digital sphere, there’s plenty of other ways to use digital currencies to buy real-world products.
For example, Overstock accepts Bitcoin payments, and so does New Egg. For them, it’s almost as simple as taking another payment method in addition to credit cards. A handful of services will automatically convert Bitcoin into US Dollars at the point of sale and send money to the vendor at the time of purchase.
In fact, there’s even been a Bitcoin Black Friday where a company like New Egg would run their regular specials, but offer exclusive discounts on certain products if you paid in Bitcoin.
The Dogecoin community has done some cooler things than product purchasing though: they sponsored a Nascar and sent the Jamaican bobsled team to the Sochi Winter Olympics. And according to Jackson, it was all funded by the community, who could elect to send small amounts of money to the cause (like $1) without getting slammed with money transfer fees.
To this day, everything Dogecoin’s done has been funded by the community – no investors.
But, Dogecoin might not be the best place to invest
When Bitcoin got a lot of media attention due to its skyrocketing prices, a lot of people saw it as a get-rich-quick scheme and wanted to buy in as an investment.
Jackson says that when a currency’s value fluctuates so much, it can discourage merchants from accepting it and consumers from using it.
“Ultimately my advice is not to think of it as an investment opportunity,” he says, “but think of it as a way to transact online.”
Raising digital currency awareness
From his position as a co-founder of a digital currency, Jackson likes to use the opportunity to speak and educate the current generation about online payments as a whole.
He talks about the work Stripe is doing, Apple Pay, Square Cash and so on. He thinks it’s possible that cash could be obsolete in 20 years.
How Jackson keeps up with his knowledge in marketing, crypto currency, and coding
Jackson says he’s always seen himself as a technical marketer, and as a marketer, you should at least be semi-aware of what you’re selling.
To do this, he’s taken on small, side projects throughout his career as a way to keep learning. For example, at a point when he was marketing a certain product for Adobe, he got into web development to make sure he could relate to the customers he was communicating with on a daily basis.
A piece of advice to his 25-year-old self
“Be open to everything and don’t be afraid to fail,” said Jackson.
He said that all too often, people are afraid to get something off the ground because of what might happen, but you never know until you try. He says not to worry about what will happen if something fails, but think about what you’ll get out of it in terms of personal growth.
Jackson Palmer’s idol: Bill Gates
Jackson said he doesn’t necessarily have an idol per se, but he is a big fan of Bill Gates.
He likes Bill Gates because of his philanthropy efforts, and it seems like all the money he’s made hasn’t gone to his head. It’s easy to see him as a the same humble, dorky guy he always was.
One productivity hack
Even though a lot of people don’t use it anymore, Jackson says he’s a fan of RSS.
He doesn’t like how social sites have recommendation algorithms based on advertising dollars and your past behavior. He sees RSS as a clean feed that he can skim through and pick out the titles he likes to read at the end of the day.
One must-read blog
Jackson says he’s a big fan of The Verge, simply because he loves everything they do.
Resources from this Episode:
- Doge meme blog post on Gawker
- Dogecoin Subreddit
- Twitch TV
- Bitcoin Black Friday
- Kevin Rose interview with Jackson Palmer
- AOL Reader
- The Verge
- The Science of Interstellar
- Twitter: @ummjackson
- Google Plus: +JacksonPalmer
- LinkedIn: Jackson Palmer
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Disclaimer: As with any digital marketing campaign, your individual results may vary.