- DOGE posted a gain of 8% MTD.
- Whale transactions recently spiked to a two-month high.
Dogecoin [DOGE]the original memecoin corrected sharply in the past 24 hours of trading, raising questions about the sustainability of its latest rally.
Despite the appeal of quick profits, so-called memecoins remain a risky proposition in the crypto markets. And no, I’m not just saying this! Your school buddy, your boss after that boring meeting, your Facebook pen pal, ALL may have warned you about the dangers of owning these ‘non-serious’ digital assets.
A test of patience, eh
The dog-themed token started gaining momentum on February 17, rising 8% to $0.090 at 12:45 UTC on February 2, according to CoinMarketCap.
Source: CoinMarketCap
This was enough to make the eyes of diamond hands light up. When they decided to take profits, the curve started to bend. At the time of writing, DOGE was trading at $0.086, erasing much of the gains made during the rebound.
Network fundamentals a silver lining
But to cut Elon Musk’s darling some slack, DOGE has performed better since February. On a monthly basis (MTD), DOGE posted a gain of 8%.
On-chain activity also saw a clear improvement during the month. According to analytics firm IntoTheBlock, Dogecoin has processed more than a million transactions every day for the past three weeks.
Source: IntoTheBlock
AMBCrypto analyzed some other key indicators to get a broader perspective. Santiment data showed that the number of daily active addresses also increased dramatically as DOGE boomed. However, the decline had a proportional impact on the indicator.
Source: Santiment
The rally also sparked interest among the whales for a while. Transactions worth more than $100,000 spiked to a two-month high before the price drop sparked a reversal.
Musketeer?
One of the biggest pain points for DOGE in recent months, at least what we at AMBCrypto have noticed, has been its over-reliance on its biggest ‘fanboy’ Elon Musk.
It is a given that Dogecoin would invariably respond positively to payment-related developments at all companies owned by Elon Musk.
Well, that’s not a problem in the real sense! It’s more about what happens when the dust settles. DOGE is falling as quickly as he went up.
Realistic or not, here is DOGE’s market cap in BTC terms
On the other hand, the coin’s lack of meaningful use cases means there is no other bullish catalyst to fall back on. Pretty undesirable for a token called the biggest memecoin.
How DOGE addresses this issue in the medium to long term would be interesting to watch. ‘Problem’ is the operative word here. What if DOGE doesn’t think this is a problem at all (crying in the corner).
