TL;DR
- Dogecoin’s network activity has hit its lowest level since October last year amid a double-digit weekly price drop for the asset.
- Despite the bearish sign, some analysts remain optimistic, envisioning a rise to a new ATH if DOGE’s valuation stays above $0.19.
DOGE Network Activity Dwindles
The biggest and oldest meme coin has been in severe decline lately. Its price has plummeted by 12% weekly, and its market capitalization has tumbled below $35 billion.
According to Ali Martinez, the asset’s network activity has also experienced a substantial setback, recently dipping to its lowest level since October 2024. The analyst revealed that the network witnessed only 66 whale transactions and less than 60,000 active addresses per day.
The development generally indicates reduced user engagement, which could be interpreted as bad news from investors and hamper interest in the meme coin. This, in turn, could trigger additional downward pressure on the price.
On the other hand, dwindling network activity can sometimes correlate with the broader market sentiment. The cryptocurrency sector has not been in its best shape lately, with Bitcoin (BTC) and numerous other leading digital assets recording significant losses. For its part, the meme coin sector has performed even worse, with its total market capitalization slipping under $70 billion.
How About a Price Reversal?
A few days ago, Martinez chipped in again, suggesting that DOGE remains on a bullish path as long as the price stays above the $0.16-$0.19 support zone.
“If history repeats, as long as Dogecoin holds above $0.19, it could rally to the resistance trendline at $4,” he predicted.
Another X user, using the moniker Cas Abbé, assumed that the meme coin’s current pattern resembles the one from Q1-Q2 2021 when DOGE pumped to $0.70.
“I think the next DOGE run will be fueled by Elon and D.O.G.E. department hype,” the market observer added.
To the uninitiated, Musk entered the political scene by spearheading a new agency called the Department of Government Efficiency. It is expected to reduce bureaucracy, cut government spending, and enhance efficiency, but DOGE proponents quickly noticed that its abbreviation is the same as their favorite cryptocurrency.
Last month, the agency featured Dogecoin’s logo on its official website, which caused a double-digit price spike for the underlying token. It will be interesting to see whether the Musk-led department will announce another DOGE-related initiative in the following months and whether this will positively affect the meme coin’s valuation.
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