On-chain data shows the activity on the Dogecoin network has witnessed a notable drop recently. Here’s what this could mean for DOGE’s price.
Dogecoin Activity-Related Metrics Have Plunged Recently
As pointed out by analyst Ali Martinez in a new post on X, some Dogecoin indicators related to network activity have returned to the lowest level in a few months.
There are three metrics of relevance here: Whale Transaction Count, Transaction Volume, and Daily Active Addresses. The first of these, the Whale Transaction Count, keeps track of the total number of DOGE transfers carrying a value of more than $1 million.
Transactions of this size generally belong to the whale entities, so the indicator can be assumed to represent the activity that the humongous traders of the market are participating in.
The Transaction Volume, the second indicator, also mostly tells us about the activity of these investors, as it measures the total amount of Dogecoin that’s becoming involved in transfers on the network. The transfers of the small investors are naturally also included in this value, but since the whale transactions tend to be quite large, they drown them out from the data of the metric.
The final indicator, the Daily Active Addresses, is the one to watch for to know the activity level of the regular investors. This metric measures the number of addresses taking part in at least one transaction on the network every day, whether as a sender or receiver.
While whales are large in size, their numbers tend to be much lower than the retail investors, so the Daily Active Addresses, which favors address count, brings out the behavior of the small entities.
Now, here is the chart shared by the analyst, that shows the trend in these Dogecoin on-chain indicators over the last few months:
Looks like all three of these metrics have witnessed a decline in recent weeks | Source: @ali_charts on X
As displayed in the above graph, all three of these indicators have dropped to relatively low levels recently, which means activity across the board has declined for Dogecoin.
At present, the whales are making just 66 daily transactions and less than 60,000 unique addresses are becoming active on the blockchain. Martinez has noted that such a low level of activity hasn’t been seen since October of last year.
Usually, Dogecoin requires high user participation, especially from the whales, in order to mount up any significant move. With the activity-related indicators sitting at lows, it’s possible that the meme coin’s price will continue to struggle in the coming days.
The metrics may be to keep an eye on, however, as it often only takes a bit of news to get investors to rush back to the meme coin.
DOGE Price
Dogecoin has plunged alongside the rest of the altcoin market during the past day, as its price has slipped under $0.23 after a decline of 5.7%.
The price of the coin seems to have been going down recently | Source: DOGEUSDT on TradingView
