With the introduction of a new mechanism that now permits the production of tokens on the Dogecoin blockchain, Dogecoin's daily transaction volume increased tenfold from the average daily earlier this week to reach a lifetime peak.
According to BitInfoCharts data, the network experienced over 645,000 transactions on Sunday, briefly surpassing both Bitcoin and Litecoin transactions that day before reverting to prior levels as of Wednesday.
According to past data, there are roughly 20,000 transactions each day for Dogecoin. However, the DRC-20 token standard's launch on May 9 has seen in a rapid rise in network activity.
These standards enable creators to create tokens that accept Dogecoin (DOGE) as network fees. This strengthens Dogecoin's value proposition and paves the way for possible blockchain-based decentralized financial (DeFi) businesses.
Even while transaction volume has increased, not everyone is delighted by the DRC-20 token distribution. DRC-20 is criticized for potentially causing network congestion and for diverging from the original intent of dogecoin, which was to be used as a regular form of payment.
One member of the Dogecoin community tweeted, "The DRC-20 Dogecoin community should stop this shameless hype." Another person added, "I believe everyone should concentrate on the use case for transactional cash.”
Any blockchain should be concerned about high fees and network congestion since they could make the network expensive and slow for regular users, which would hurt adoption efforts.
The 'Bitcoin Request for Comment' (BRC-20) standard, created by Bitcoin itself, went online in March of last year, ushering in two-year-high fees as a Bitcoin-based meme coin trade frenzy gained attention on the network.
What else in DOGEland?
Meanwhile, five transactions totaling 680 billion DOGE and valued at approximately $48 million apiece were reported by Whale Alert. Furthermore, just one wallet address was used for these transactions. 3.4 billion DOGE tokens, worth roughly $250 million, were therefore shifted by the whale. The whale is currently the fifth-largest holder of DOGE.
However, there are contradicting signals about the direction of the Dogecoin price trend provided by the long-term weekly technical analysis. Despite breaking out from a long-term falling resistance line (dashed), the price was unable to go past the $0.115 barrier zone.
As a result, the price was reduced (red icon), which produced a long upper wick. As it implies that buyers were unable to support the increase, this is seen as a negative indicator. Instead, sellers took over, which caused the price to drop.
The rejection caused the meme coin to fall to an ascending support line that has been in place since June 2022. Four times now, the price has been on the verge of the line.