- Dogecoin’s daily transaction volume reached an all-time high following the introduction of DRC-20 tokens on its blockchain.
- Despite the surge in transactions, the DRC-20 token deployment has faced criticism due to concerns about network congestion and deviation from Dogecoin’s original purpose.
Dogecoin, the popular meme-based cryptocurrency, recently experienced a tenfold increase in its daily transaction volume, setting a new record. This surge in activity was triggered by the introduction of a new mechanism that enables the issuance of tokens on the Dogecoin blockchain, known as DRC-20 tokens.
According to data from blockchair, the Dogecoin network recorded over 645,000 transactions in a single day, surpassing both Bitcoin and Litecoin transactions for a brief period. While the transaction volume has since returned to previous levels, this event marked a significant milestone for Dogecoin.
Historically, Dogecoin has averaged around 20,000 daily transactions. However, the launch of the DRC-20 token standard on May 9 led to an immediate increase in network activity. These standards allow developers to issue tokens that require network fees to be paid in Dogecoin (DOGE), enhancing the cryptocurrency’s value proposition and paving the way for potential decentralized finance (DeFi) services built on its blockchain.
Despite the increase in transactions, the deployment of DRC-20 tokens has not been without controversy. Critics argue that DRC-20 could lead to network congestion and deviate from Dogecoin’s original purpose as a transactional currency. Concerns about high fees and network congestion are valid for any blockchain, as they could make the network expensive and slow for everyday users, thereby hindering adoption plans.
The introduction of the ‘Bitcoin Request for Comment’ (BRC-20) standard on the Bitcoin network last month led to a similar situation. The launch resulted in two-year high fees as a Bitcoin-based meme coin trading frenzy gained notoriety on the network.
Despite the criticism, the introduction of DRC-20 tokens represents a significant development for Dogecoin, potentially opening up new possibilities for its use in the world of DeFi. As the situation evolves, it will be interesting to see how the Dogecoin community and the broader cryptocurrency market respond to these changes.