Dogecoin Slumps—70% Drop In Open Interest Raises Concerns
Investor enthusiasm Dog Sharply decline. Within three months, the opening of meme coins decreased by more than 67%. The value in December 2024 is US$4.07 billion. By February 2025, it had dropped to $1.33 billion. This significant decline shows market caution. Many traders are retreating due to uncertainty in the wider cryptocurrency market.
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Dogecoin open interest drops significantly
Open interest Measure positive contracts on futures and options exchanges. Typically, a drop in number means that a trader closes or avoids a new position. Dogecoin’s OI fell by 67% toward weak investor trust.
Given the turmoil in the market, many people are now turning their attention to more stable investments. Sentiment declines are also suitable for a larger model of crypto markets, with sales of recent futures trades recently hitting. By contrast, Bitcoin and Ethereum maintain a higher level of open interest, with smaller altcoins such as Dogecoin being seen dropping sharply.
#DogeCoin $ DOGE Open interest has dropped 67% over the past three months, down from an all-time high of $4.07 billion to $1.33 billion today! pic.twitter.com/yrxjqqljnc
– ali (@ali_charts) February 27, 2025
Internet activities stagger
Dogecoin’s network activity has also declined. The activity address in November 2024 is close to 1.3 million. By February 2025, the count had dropped to 130,000, a figure that fell 95% in just a few months. Fewer transactions mean a decrease in the number of users is interacting with the system.
Data on the chain suggests that dog transactions are less frequent, indicating a decrease in retail and retail participation Institutional Investors. The decline in activity also means fewer new investors join the network, which may limit future growth potential.
Meme coins to ic
Dogecoin isn’t the only meme coin that struggles. Other meme-based cryptocurrencies have seen major price increases in 2024, but have had headaches in early 2025.
Many investors who gathered last year are now cashing out. At least for the time being, the hype around meme coins seems to be fading. Although some traders still find some hope in meme coins, this sentiment has usually become pessimistic.
Analysts believe that joke coins like Dogecoin may continue to lose value if they don’t get a lot of new users or strong community participation. Similarly, as more and more projects are on the market, investors’ attention is getting harder.
…But the institutional interests are still alive
Meanwhile, even if OI and network activity have declined, Dogecoin remains attractive to many institutions. For example, Grayscale Investment has established Dogecoin Trust In January this year. The move shows that larger buyers still believe that the coins have great potential.
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But it is not clear whether institutional support can compensate for the decline in retail interest rates. Grayscale’s involvement shows that Dogecoin’s long-term survival is still promising, but the real test will be whether regular buyers will come back to support the coins.
If sentiment recovers and a wider range of cryptocurrencies is added, then Dogecoin may recover. Until then, the path to the memes that went forward did not look bright. However, anything can happen in the encrypted space.
Featured images by Gemini Imagen, charts by TradingView
