Dogecoin In Demand: Data Shows DOGE Adoption Is Accelerating
December 25 2023 - 2:30PM
NEWSBTC
On-chain data suggests the Dogecoin adoption has been picking up
recently as a large number of new addresses are popping up on the
network. Dogecoin Is Observing A High Number Of Daily New Addresses
Currently In a new post on X, analyst Ali talked about how the
Dogecoin network activity has been looking like recently in terms
of new address creation. A “new address” is one that has taken part
in some kind of transaction activity for the first time. Some of
the new addresses that pop up on the network every day belong to
the existing users, who may be creating additional addresses for
privacy purposes or simply moving to a different wallet. Related
Reading: Bitcoin Whales Do $2.2 Billion Selloff, But BTC Stays
Strong The rest of the new addresses, though, are being created by
fresh investors entering into the market, so the daily total value
of the new addresses can provide hints about how the adoption of
the meme coin is coming along. The below chart shows the trend in
this metric for Dogecoin over the last couple of months: The value
of the metric appears to have seen some overall uptrend in the last
few weeks | Source: @ali_charts on X As displayed in the above
graph, the daily number of new Dogecoin addresses started spiking
last month and has since been consistently setting new highs as the
metric continues in an overall upward trajectory. This would
suggest that the network has been receiving a consistently high
influx of new investors recently. Adoption is always a constructive
sign for any cryptocurrency, as fresh hands can help build a solid
foundation that future uplifts in the price can sustainably grow
off. Thus, it’s crucial for assets to continue to look attractive
to new users, something that Dogecoin appears to have been doing
fine recently. Any positive effects on the price that come through
adoption, though, generally only appear in the long term. Rather,
depending on the nature of the adoption, it can in fact impart a
negative influence on the cryptocurrency in the short-term. This
happens when too many new users join the blockchain in a short
amount of time, only buying into the asset due to FOMO. Recently,
the on-chain analytics firm Santiment also discussed this fast pace
of address creation on the Dogecoin network, noting that Bitcoin
(BTC) is also displaying a similar trend. The trend in the
addresses of the top assets in the sector | Source: Santiment on X
“Though network growth is a great sign long-term, this rapid rate
of new wallets is a FOMO sign to be slightly cautious of,”
explained the analytics firm in the post. Related Reading: Polygon
Breaks Through $0.85, Is A Move To New Highs Next? From the chart,
it’s visible that Cardano (ADA) is the only asset among the top
cryptocurrencies by market cap that’s not displaying any sort of
address growth at all. DOGE Price Since the rally Dogecoin observed
during the starting third of the month, the asset has gone rather
stale, as its price has continued to move sideways around the
$0.093 level during the last two weeks. DOGE hasn't enjoyed any
upwards momentum in recent days | Source: DOGEUSD on TradingView
Featured image from Kanchanara on Unsplash.com, charts from
TradingView.com, Santiment.net, IntoTheBlock.com
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