Dogecoin’s on-chain transactions increased more than 60x from about 20,000 transactions on May 1 to over 1.20 million on May 20, data from BitInfoCharts shows.
60X peak in number of transactions
The current spike represents a 60X expansion in the number of Dogecoin transactions, a remarkable development mainly due to the launch of Ordinals on the proof-of-work blockchain.
The spike in Dogecoin transactions coincided with the launch of Ordinals on May 10. With Ordinals now on Dogecoin, another proof-of-work blockchain that uses the same consensus style as Bitcoin, users can create a new token based on the DRC-20 system. These tokens represent unique items such as texts, images or videos. Crucially, users don’t have to use smart contracts to mint them.
However, despite the exponential increase in the number of transactions, DOGE prices are stable, moving horizontally and relatively unchanged over the past three weeks. The coin is also down 31% from its peaks in April 2023.
Related reading: Dogecoin multiple attempts at $0.10: will the barrier finally be broken?
Dogecoin is the first meme coin created as a joke and launched in 2013. But over the years it has gained a significant following and endorsement, including from billionaire tech investor Elon Musk.
DOGE, the native currency of Dogecoin, is one of the largest cryptocurrency networks whose market cap puts it among the top 10 coins.
As of May 22, DOGE had a market cap of $10.1 billion and is more valuable than Polygon, an Ethereum sidechain, and Solana, a smart contract platform, according to CoinMarketCap facts.
Ordinal numbers on Dogecoin
The DRC-20 standard is inspired by the more popular ERC-20 standard in Ethereum. Tokens that comply with DRC-20 on the Dogecoin platform are fungible and transferable.
These tokens allow users to “enroll” files and link them to the smallest unit of Dogecoin called “shibes”. These unique files represent various assets, including texts, images, videos, applications and many more.
Enrolled files, confirmed by Dogecoin miners and added to the blockchain, are unique and similar to non-fungible tokens (NFTs).
The rise of DRC-20 tokens on Dogecoin explains why there has been a sharp spike in on-chain transactions over the past 12 days, as trackers show.
As an illustration, BitInfoCharts data shows that the number of on-chain transactions was 48,500 on May 10. However, the number has risen steadily over the past 12 days, peaking at 1.2 million on May 20.
Given the popularity of NFTs on proof-of-work blockchains such as Bitcoin, Litecoin, and Dogecoin, the number of transactions on each network will only continue to rise.
Related Reading: Bugs Discovered on the Ordinals Protocol as Bitcoin Rips Over $30,000
Ordinals, the team behind the BRC-20 standard now being replicated on Dogecoin, aims to expand Bitcoin’s use case. Ordinals believe that proof-of-work blockchains offer better security and decentralization, allowing NFTs to thrive.
Feature image from Canva, chart from TradingView
