After a flurry of activity that saw Dogecoin (DOGE) briefly process a higher dollar value of daily transactions than Bitcoin (BTC) and Ether (ETH) combined, the surge seen on the Dogecoin blockchain appears to be slowing down.
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.
Outdoing the two most well-known blockchains in the world is all the more astonishing, given that Dogecoin handled daily totals as low as $10 million as recently as December 2020. New eyes were brought to Dogecoin in 2021 by Tesla CEO Elon Musk and by the concentrated efforts of social media traders intent on pumping Dogecoin in a manner similar to the shares of gaming retailer GameStop.
And while general activity on Dogecoin remains well above December lows, a substantial reversal was witnessed in May, which suggests whales might be tiring 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 ramping up of activity on the Dogecoin blockchain occurred in spikes scattered throughout the year to date, marked increases to the two metrics mentioned above were witnessed in mid-April as traders began making efforts to artificially pump the value of Dogecoin in the lead up to 4/20 day.
The subsequent short-fall in network activity accompanied a 63% drop in the Dogecoin price throughout most of May as it fell from its recent all-time high of $0.73.