Data shows Dogecoin has seen a major boost in its on-chain metrics recently, something that may be bullish for the meme coin’s price.
Dogecoin Whale Transactions And Active Addresses Have Surged Recently
According to data from the on-chain analytics firm Santiment, a couple of DOGE on-chain metrics are at two-month highs right now. The relevant indicators here are the whale transaction count and the daily active addresses.
The “whale transaction count” measures the total number of Dogecoin transfers taking place on the blockchain that is worth at least $100,000 in value. When the value of this metric is high, it means whales are actively trading the asset right now.
Since the transactions of this cohort are quite large in scale, they can potentially cause the price to noticeably change. Because of this reason, a large number of them happening at once can lead to more volatility for DOGE.
The other metric of interest here, the “daily active addresses,” simply keeps track of the total number of addresses that are being involved in some transaction activity on the network on any given day. The metric counts both receivers and senders for this calculation.
When this indicator has high values, it means a large number of investors are transacting on the blockchain daily. Such a trend suggests user interest in DOGE is high currently.
Now, here is a chart that shows the trend in these two Dogecoin on-chain indicators over the past month:
Looks like both these metrics have observed some sharp increase in recent days | Source: Santiment on Twitter
As shown in the above graph, both the Dogecoin whale transaction count and daily active addresses have seen some pretty high values in the last few days. In total, there have been 523 whale transactions during the past day or so, which is the highest level since November 27, more than two months ago.
The daily active addresses have been around a value of 86,400 during the last couple of days, which is the largest two-day run that the indicator has observed between the 2nd and 3rd of November, almost three months ago.
These boosts in on-chain activity have coincided with news that Elon Musk is planning to add cryptocurrency payments to Twitter. Although it’s currently unclear whether Dogecoin will ever find its way onto the platform (as it appears only fiat currencies are being added first), the DOGE price has nonetheless responded with a surge.
The current high on-chain activity has proved to be bullish in the last few days, but there is no guarantee that the indicators will continue to be at similar levels moving forward. Also, even if the metrics remain elevated, there is a chance that the volatility caused by them wouldn’t be bullish, as these same signs are also seen when the investors are selling instead.
At the time of writing, Dogecoin is trading around $0.0915, up 8% in the last week.
DOGE has surged | Source: DOGEUSD on TradingView
Featured image from Kanchanara on Unsplash.com, charts from TradingView.com, Santiment.net