Recently, it was announced that a new Dogecoin Layer 2 blockchain was launched for users.
Marketed as “Dogechain is Dogecoin’s exclusive blockchain” Dogechain was created by an anonymous group of developers. The blockchain promises to be a bridge for Dogecoin, allowing use for Defi protocols, NFTs, and games.
This week, Dogechain launched its DC token on August 24 via airdrop for qualifying wallets.
In order to qualify, investors needed to have interacted with the Dogechain protocol before August 23rd.
This move means that Dogechain required adding Dogecoin liquidity to the Dogechain protocol.
A Reddit user by the name of u/evelynvee noticed that there was unusual activity regarding an alleged dump of DC tokens.
“The developer got 20B tokens upfront and dumped 1-2M every minute in Uniswap.” The Reddit user said. “At the time of writing, they have dumped 150M token (estimated worth $225k)”
To add to the skepticism, the users receiving the DC airdrops were not able to dump their tokens right away. The token liquidity was in Ethereum mainnet Uniswap. This means that anyone receiving the airdrop would need to bridge Dogechain to Ethereum mainnet.
The minimum amount allowed for the bridge was 9 million DC tokens (around $16,000), to make it worse the transaction required an 8 million fee.
While Dogechain owners saw this as a potential red flag, the official Dogechain Twitter did not respond to comments and requests about what is happening.
Other Dogechain Red Flags
The official Dogechain Twitter account promoted the blockchain as “layer 2 for Dogecoin”, which simply, is not true.
Dogechain was not built on top of Dogecoin’s ecosystem, instead, it uses “Polygon Edge” to function as Dogecoin’s blockchain.
Dogecoin Developers Warned Investors That Dogecoin Had no Relationship with Dogechain
Dogechain’s marketing strategy of closely attaching its brand to Dogecoin has bothered a few people who work at Dogecoin.
Dogecoin’s Foundation member Jens Wiechers had to go to Twitter to clarify that Dogecoin has no relationship whatsoever with Dogechain.
“Claims in paid media that Dogecoin launched a “Dogechain” test network are false.” Wiechers wrote on Twitter. “Neither @Dogecoin/@dogecoin_devs nor @BillyM2k,@ummjackson or others associated with @DogecoinFdn are in any way affiliated with the token.”
In his turn, a Dogecoin foundation designer known on Twitter as “cb_doge” had harsher statements to say about the Dogechain.
“Dogechain is not linked with #Dogecoin in any way,” cb_doge wrote on Twitter. “It’s another knockoff token.”