Is Dogecoin Finished After an 86% Plunge? The Shocking Truth Revealed by On-Chain Data

▲ Dogecoin (DOGE) / ChatGPT-generated image ©

Dogecoin (DOGE), which has plunged 86% from its all-time high and endured a harsh winter, is signaling a dramatic comeback behind the scenes with explosive network growth and strong buying pressure in the derivatives market.

According to cryptocurrency outlet Bitcoinist on February 28 (local time), Dogecoin is currently trading below $0.10 and showing its worst price action, remaining under all major moving averages. However, contrary to the bleak chart outlook, on-chain data clearly demonstrates remarkable resilience and network activity that the market may be overlooking, aligning with conditions that typically preceded massive bull runs in the past.

Network growth metrics, which often reflect bullish sentiment before a price rebound, are showing notable signals. Dogecoin’s daily active addresses currently stand at around 54,500, recently surging to as high as 58,000. More significantly, the long-term trend is striking. According to crypto analyst PennybagsCX, the average number of active addresses has jumped from 806,000 at the beginning of the year to over 1.05 million recently. The explosive increase in network participation, even amid a steep price decline when investors could easily exit the market, suggests enormous underlying potential. Dogecoin currently ranks third among all Proof-of-Work (PoW) blockchains in terms of 24-hour active addresses with a 12% market share, outperforming Dash (DASH) and Bitcoin Cash (BCH).

Positioning in the derivatives market is also heavily skewed toward longs, reinforcing bullish expectations. According to Coinglass data, the long-to-short ratio on Binance stands at 2.29 for retail traders and 2.73 for whale accounts, both reflecting strong bullish sentiment. On OKX, the retail long-to-short ratio reached an extreme 3.49, while Bybit also showed overwhelming long dominance with ratios of 2.98 for retail and 2.99 for whales. However, Smart Money sentiment across all three major exchanges remains bearish, flashing the only notable warning signal.

The Taker Volume Ratio, which reflects buying appetite, recently climbed to 63%. This indicates that traders executing market buy orders are leading activity, and a ratio above 50% suggests demand is strong enough for investors to willingly pay current prices.

Crucially, Dogecoin’s long-term cycle indicator known as Profit-Days has exceeded 1,100 days for the first time in history. This metric rises when sustained profitability is maintained among holders. Historical data shows that whenever this figure surpassed 800 days, it consistently marked a major turning point, followed months later by explosive parabolic rallies. On-chain indicators hidden behind the price action strongly suggest that Dogecoin may be preparing to end its prolonged slump and stage another underdog miracle.

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