Do you believe in the ghost of Christmas past? After a sluggish performance throughout 2023, Dogecoin is enjoying renewed interest in the crypto market, which pushed its price and trading volume way above last year’s levels.
According to data presented by AltIndex.com, the popular meme coin and lockdown crypto hero has seen its price jump by 94% month-over-month, while its trading volume hit over $100 billion in February.
Dogecoin’s refreshed popularity follows a pretty rough year for the popular meme coin. After the crypto winter, meme coins, which add a layer of risk, have seen their values and the number of investors drop. While many managed to bounce back, Dogecoin continued struggling with its community not giving it enough momentum to drive its price back to 2021 levels.
Massive trading volume increase for Dogecoin
However, not only did that change in the first months of 2024, but Dogecoin cemented its position as the top performer among major cryptos, outpacing the competition in percentage gains. According to CoinMarketCap data, Dogecoin’s 24-hour trading volume recently skyrocketed by a whopping 2,300% month-over-month, jumping from roughly $280 million at the beginning of February to over $5 billion last week. The impressive four-digit growth has helped the meme coin climb the chart of the most traded coins in the crypto space.
Statistics show Dogecoin’s monthly trading volume hit $105 billion in February, ranking as the seventh most-traded cryptocurrency. Shiba Inu was one spot above with $108.8 billion in 30-day trading volume, while Tether, Bitcoin, Ethereum, First Digital USD, and USDC took the first five spots on the list.
“If Dogecoin ever managed to get credible utility, such as a legitimate means of payment, it could become huge, however given that it has an unlimited supply, unlike BTC, which has a maximum of 21m, and the fact that it already had a $24 billion market cap, perhaps limit the upside potential,” said Manu Choudhary, CEO of DeFinity Markets in London. “If DOGE becomes a legitimate and widely accepted payment method, demand for the coin would surge, potentially driving up the price. Credible utility would shift the perception of DOGE from a meme coin to a valuable tool, attracting more users and investment.”
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Last week, Dogecoin was traded at $0.161, still 70% below its all-time high in April 2021. Nevertheless, the meme coin doubled its market cap in just a month. At the time of writing, DOGE boasted a market cap of $22.8 billion, up from $11.3 billion in February, helping it to rise from the 10th to the 9th position on the list of top ten cryptos.
Is this the return of the meme coin?
Dogecoin’s fantastic market performance demonstrates the growing investor interest in this meme coin. Also, its price and trading volume spike aligns with a broader trend of meme coins coming into the crypto market’s spotlight again.
The CoinMarketCap data show the largest meme coins by market cap, Dogecoin, Shiba Inu, Pepe, and Bonk all saw four-digit trading volume growth last month. Shiba Inu’s daily trading volume skyrocketed by a whopping 4,800%, rising from $83.1 million in February to $4.1 billion last week. Pepe saw the second-largest increase of 3,500%, with its 24-hour trading volume spiking to over $3 billion last week. Bonk and Dogwifhat follow with 2,400% and 844% month-over-month increases, and $1.1 billion and $373 million in daily trading volumes, respectively.
“With no limit on new DOGE being created, there’s a constant inflationary pressure,” said Choudhary at Definity Markets. “This can make it difficult for the price to appreciate significantly in the long run, unlike Bitcoin (BTC) with its capped supply.”
Choudhary said scarcity plays a major role in value perception. “An unlimited supply of DOGE reduces its appeal as a store of value compared to BTC’s limited availability,” he concluded.
Also, three of the ten most traded cryptos in February were meme coins. Shiba Inu ranked sixth with $108.8 billion in monthly trading volume, one place before Dogecoin. Pepe was last on the list, with a 30-day trading volume of almost $70 billion.
“The cryptocurrency market is experiencing an exciting period of growth and optimism, primarily driven by the prominence of Bitcoin and its recent approval of ETFs on the New York Stock Exchange,” said Ernesto Di Giacomo, a market analyst with XS.com. “This regulatory milestone has instilled confidence in investors and triggered a bullish rally that points towards all-time highs for Bitcoin and many cryptocurrencies in the coming years. Bitcoin’s influence as the undisputed market leader remains undeniable, and its trajectory could shape the entire crypto industry in the years to come.”
