Dogecoin’s daily trading volume has been declining since July 2023. The price of Dogecoin has also fallen by more than 3% in the past 24 hours.

  • DOGE’s trading volume plummeted as weighted sentiment fell.

  • Most market indicators suggest that DOGE’s price could drop further.

Dogecoin [DOGE] network usage has dropped significantly over the past few months. Earlier, the blockchain’s network activity received a boost when new Doginals were launched.

Now, when the heat dies down, will the new updates related to Doginals be any good for Dogecoin?

Will Dogecoin’s network activity recover?

Dogecoin’s network usage has dropped significantly over the past few months, which is evident from its daily transactions. According to Bitinfocharts, DOGE’s daily transaction volume has dropped below the 50,000 mark after surging in July.

The chart has also remained around the same level for more than a month.

The blockchain had earlier witnessed a major surge in network activity when Doginal was released. First, Dogecoins are fragments of Dogecoin — individual “Shibes” on the Dogecoin network — tagged with rich data, such as text or images.

The Doginals DRC20 standard allows Dogecoin nodes to write data for each Shibe, thereby creating a Doginal.

When the blockchain launched Doginals, its network activity surged, but later cooled off. Now, there is a new update related to it, which could once again act as a catalyst to increase memecoin network activity.

Doge Labs recently announced that Doge Labs Wallet version 1.0.11 is now available on Chrome. The update is likely to attract new users and increase blockchain network activity.

Dogecoin is experiencing a price correction

During this period, DOGE has seen a significant drop in its price. According to CoinMarketCap, DOGE has fallen by more than 3% in the past 24 hours alone. As of this writing, it is trading at $0.05894 with a market cap of over $8.3 billion, making it the ninth-largest cryptocurrency.

DOGE’s trading volume has also declined over the past few days, suggesting that investors are not actively trading the memecoin.

DOGE’s Binance funding rate remained in the green for most of the last week, which means that investors are buying the token at lower prices. Moreover, negative sentiment surrounding the token is dominating the market, as evident from the decline in its weighted sentiment.

Things could get worse as Dogecoin’s Bollinger Bands suggest that the coin’s price volatility could soon increase. Its relative strength index (RSI) has fallen sharply.

On top of that, Dogecoin’s Chaikin Money Flow (CMF) has also declined towards neutral levels, increasing the likelihood of a continued southward price movement.