Bitrabo Editorial
The consistency in Dogecoin’s network activity poses a threat to its price stability, potentially leading to a decline due to the lack of significant growth in this crucial on-chain metric amidst spikes in other indicators.
Current State of Dogecoin Network Activity
Recent data from IntoTheBlock indicates a bearish outlook for Dogecoin’s network growth, with no discernible uptick in activity. The number of new addresses on the network has decreased by almost 10% over the last seven days, portraying a concerning trend.
Insights from IntoTheBlock’s analysis reveal a reliance on existing holders as the number of new addresses joining the network dwindles. This trend, coupled with fluctuating transaction levels over the past few months, indicates a lack of sustained new investor interest in Dogecoin.
While sporadic transaction spikes were observed, they were short-lived, underscoring the absence of a continuous influx of new participants onto the network. This slowdown in new addresses contributes to Dogecoin’s stagnant price performance compared to other meme coins.
Dogecoin’s diamond holders play a crucial role in supporting its price amidst reduced transaction volume, with these long-term holders continuing to retain their holdings despite the network’s diminished activity.
Data reveals that a significant portion of Dogecoin holders remain profitable despite the coin’s subdued price performance, with a majority having purchased DOGE at prices below $0.10.
Factors Affecting DOGE’s Network Growth
One probable reason behind the stagnation in Dogecoin’s network activity is the perceived lack of potential upside for new investors at its current valuation, leading them to explore alternative meme coins that promise higher returns such as Dogwifhat (WIF) and Pepe (PEPE).
While Dogecoin has recorded modest year-to-date gains, newer meme coins have seen exponential growth, triggering a shift in investor focus away from DOGE. The saturation of the meme coin market, particularly in the Solana ecosystem, further diminishes Dogecoin’s appeal.
As of writing, Dogecoin is priced at approximately $0.099, reflecting a nearly 2% increase in the last 24 hours based on data from CoinMarketCap.