162 Interactions, 2 today
DOGE’s recent rise in network activity looks to be stalling.
The rise witnessed on the Dogecoin blockchain looks to be slowing down after a burst of activity that saw Dogecoin (DOGE) momentarily handle a bigger dollar worth of daily transactions than Bitcoin (BTC) and Ether (ETH) combined.
Dogecoin’s price increase throughout 2021 has been accompanied by an equally outlandish increase to the value of transactions taking place on its blockchain. The dollar value of DOGE sent from wallet to wallet peaked at $82 billion on May 5, exceeding the $35 billion recorded on Bitcoin and $12 billion on Ethereum.
Outperforming the world’s two most well-known blockchains is all the more remarkable given that Dogecoin handled daily totals as low as $10 million as recently as December 2020. Tesla CEO Elon Musk and the concerted efforts of social media traders focused on boosting Dogecoin in a way akin to the shares of game store GameStop attracted new eyes to Dogecoin in 2021.
While overall activity on Dogecoin remained far above December lows, a significant reversal was observed in May, indicating that whales may be weary of Dogecoin.
Dogecoin processed just under $5 billion worth of daily transactions on Wednesday, marking a 93% decrease from the $82-billion all-time high recorded earlier in the month.
Meanwhile, DOGE’s average transaction value fell sharply from $1.16 million on Sunday to under $240,000 three days later on Wednesday — a drop of almost 80%. The coin’s oversized average transaction value has persisted for much of the past month despite arriving via a much smaller sample size — a sign that Dogecoin was primarily being used by large account holders.
Although the rise in activity on the Dogecoin blockchain happened in spurts throughout the year, significant rises in the two measures described above were observed in mid-April as traders began attempting to artificially push the value of Dogecoin in the run-up to 4/20 day.
The resulting decline in network activity was matched by a 63 percent reduction in the Dogecoin price over most of May, as it slid from its previous all-time high of $0.73.