It was Doge day afternoon everywhere again, today on Wednesday as Dogecoin [DOGE] continued its assault on the cryptocurrency market capitalization rankings. The meme coin overtook Ripple [XRP] to become the 4th-largest cryptocurrency by implied market cap after climbing to a per-coin valuation of $0.69 USD – a target that was specifically set by traders on social media.
But crypto’s latest media darling might not be as wholesome as it seems. For all the hype surrounding Dogecoin [and its de facto master, Elon Musk], publicly available data suggests relatively few people are literally using the blockchain technology, and people who do use it account for an incredibly large portion of its overall activity.
Consider that the dollar value of coins sent across the Dogecoin blockchain earlier on Tuesday exceeded $58 Bln. That figure was 70% over the net transferred on Bitcoin [$34 Bln] and 260% over on Ethereum [$16 Bln].
Digging into on-chain data further, we see that despite Dogecoin moving a better value of coins than the two leading crypto assets within the world, it achieved this with a mere fraction of its transactions.
Over 1.4 Mln transactions were counted on the Ethereum blockchain yesterday, consistent with data from Bitinfocharts, while on the brink of 300k were counted on Bitcoin. Compare this to only 76k recorded on the Dogecoin blockchain, and a clear wealth gap begins to emerge.
Indeed, when watching Dogecoin’s average transaction value on the day in question, it stood at almost double that recorded on Bitcoin [BTC]. The typical DOGE transaction value stood at $800k, compared to $420k on BTC. Its statistics relative to Ethereum paint a good more dire picture – Dogecoin’s average transaction value exceeded Ethereum’s by 8,000%, despite processing only 5% of the number of transactions.
Combined with the long-standing reality that one single address holds 28% of all coins alive, while just 12 accounts for 67%, it becomes clear that Dogecoin isn’t precisely the people’s champion that interested parties would have the general public believe.
A recently published report by Galaxy Digital piled on the misery regarding Dogecoin’s general lack of authenticity as a real crypto-asset project. Referred “Dogecoin: the foremost Honest Sh*tcoin,” the report highlighted the very fact that Dogecoin’s GitHub repository [where updates to the blockchain’s code are logged by developers] hasn’t been touched since 2017. What’s more, the amount of fully synced nodes [computers running copies of the Dogecoin blockchain] is simply 26% of the general node count, suggesting few people are willing to form the effort to take care of the blockchain’s network security.