Dogecoin (DOGE) has experienced a significant downturn, leaving investors grappling with losses. At the time of writing, DOGE is trading at $0.213, marking a 5.17% increase in the past 24 hours. However, the meme coin remains 15.72% lower over the past week, underscoring its ongoing volatility.
Declining Network Activity Raises Red Flags
While Dogecoin shows signs of short-term recovery, its network activity has plummeted, raising concerns among investors. Crypto analyst Ali Martinez recently highlighted a sharp decline in active addresses over the last three months.
On November 21, 2024, Dogecoin saw a surge in activity, recording 1,292,770 new active addresses, peaking above 2.4 million. However, this momentum was short-lived. Between December 2024 and February 2025, the number of active addresses fell by approximately 95%, with only 30,815 new addresses recorded by February 23, 2025.
This sharp drop in engagement correlates with DOGE’s price decline from $0.4868 to $0.196, highlighting weakened demand and investor caution.
#Dogecoin $DOGE network activity has declined by 95%, dropping from 2.66 million active addresses in November to just 130,282 today! pic.twitter.com/SlH3qTuMP6
— Ali (@ali_charts) February 25, 2025
Changing Ownership Structure Signals Increased Speculation
Further analysis of Dogecoin’s ownership distribution reveals a shifting investor landscape. Holders are categorized into three groups: long-term investors (1+ year), mid-term holders (1-12 months), and short-term traders (<1 month).
Recent data indicates a 2.67% decline in long-term holders, suggesting reduced accumulation. Mid-term holders also saw an 11.81% drop, signaling a market exit by a significant number of investors.
Conversely, the percentage of short-term traders surged by 107.45%, reflecting increased speculative activity. This shift suggests that Dogecoin’s investor base is moving towards short-term trading, increasing price volatility.
Potential for a Dogecoin Rebound?
Despite recent struggles, market analyst CryptoELITES believes Dogecoin’s correction phase is nearing its end. He identified a cup-and-handle pattern forming from DOGE’s 2024 peak and recent lows, suggesting a bullish breakout.
Also Read: Dogecoin Price Holds at Key Support: Whale Accumulation Signals Potential Breakout
CryptoELITES predicts a potential 255% rally to $0.75, surpassing its 2021 all-time high. He further anticipates continued momentum, potentially driving DOGE to $1.5 and even $5, marking a staggering 2,270% surge.
As speculation rises, investors remain watchful for key resistance levels to confirm a sustainable uptrend.
Disclaimer: The information in this article is for general purposes only and does not constitute financial advice. The author’s views are personal and may not reflect the views of CoinBrief.io. Before making any investment decisions, you should always conduct your own research. Coin Brief is not responsible for any financial losses.
