Dogecoin Adoption Rockets 1,100%: Trailer For Price Action?

On-chain data shows the number of new Dogecoin addresses has shot up by 1,100%, a sign that could end up being bullish for the meme coin.

Dogecoin Daily New Addresses Have Set A New All-Time High

As pointed out by an analyst, Ali, in a post on X, the DOGE network has seen some impressive growth in addresses recently. The relevant on-chain indicator here is “Daily New Addresses,” which keeps track of the total amount of addresses coming online for the first time on the Dogecoin blockchain every day.

There are a couple of reasons why new addresses would be created on the blockchain. The first and the more major factor is natural adoption, as fresh investors coming into the asset would create new addresses for themselves.

The other reason could be because of existing users generating more addresses for themselves, potentially for privacy-related purposes, as they may not want their transactions to all be tracked to the same address.

In general, the former factor is more likely to be the contributor in significant network growth. As such, spikes in the Daily New Addresses can suggest an influx of fresh interest into the memecoin.

On the other hand, the indicator’s value staying low can imply the investors aren’t paying attention to the cryptocurrency as they aren’t coming in to open up addresses.

Now, here is a chart that shows the trend in the Dogecoin Daily New Addresses over the entire history of the coin:

The value of the metric seems to have shot up in recent days | Source: @ali_charts on X

As displayed in the above graph, the Dogecoin blockchain has enjoyed some notable growth recently as the New Daily Addresses indicator has shot up. During the past week, the metric has registered a total rise of almost 1,100%.

Following this increase, the indicator’s value has touched the 247,240 mark. From the chart, it’s visible that the metric has now surpassed the peak seen shortly after the meme coin launched back in the day, meaning that the chain has just witnessed the highest amount of daily address creation ever.

Historically, adoption has been a constructive sign for any cryptocurrency network, as it provides a strong foundation for future price growth to occur. “A sustained uptrend in network expansion could soon reflect positively on DOGE prices,” explains Ali.

DOGE Price

Since its plunge to start the year, Dogecoin has been unable to make any sustained recovery, with its price heading in an overall flat trajectory. The meme coin is looking to cap off this disappointing first month of the year, being down around 9% as it trades around $0.0817.

Looks like the price of the asset has been mostly moving sideways over the past month | Source: DOGEUSD on TradingView

It now remains to be seen if Dogecoin can turn itself around in the coming month, given the strong adoption that has just taken place on the memecoin’s network.

Featured image from Kanchanara on Unsplash.com, charts from TradingView.com, IntoTheBlock.com