Dogecoin has experienced a significant surge in price, with its monthly gains reaching 45% as it crossed the $0.17 mark on May 23. While other meme coins like PEPE and Floki Inu have seen triple-digit gains, the steady increase in DOGE’s value should not be overlooked.
There are several factors driving this uptrend. Media headlines, bullish macroeconomic indices in the US, and the influence of the Gamestop saga in the crypto markets have all contributed to increased investor demand for memecoins. However, on-chain data analysis reveals that Dogecoin miners’ sentiment has also played a crucial role in the coin’s price surge.
Following the Bitcoin halving, Dogecoin miners have shifted their strategy and are now accumulating newly mined coins instead of selling them. This change in sentiment is evident in the increase in miners’ reserves, indicating their bullish outlook on the short-term price prospects of DOGE. Since the halving, miners have added 70 million DOGE to their reserves, bringing the total to 4.16 billion DOGE.
It is speculated that a significant number of Bitcoin miners, who became unprofitable after the halving, may have repurposed their equipment to mine Dogecoin and other cheaper alternative Proof-of-Work coins. With better mining equipment and potentially higher profitability, these new Dogecoin miners seem more inclined to accumulate coins rather than sell them regularly.
This shift in miners’ behavior could lead to a decrease in the number of newly-mined coins entering the market, thereby supporting upward price movements for DOGE. As the memecoin market rally gains momentum, the reduced supply of newly-mined coins may help maintain higher support levels during correction phases.
With a 45% gain in May alone, Dogecoin is now poised to surpass the $0.20 mark. The accumulation frenzy by DOGE miners, which has amounted to $11.7 million worth of coins since the Bitcoin halving, further enhances the probability of a breakout. However, investors will closely watch the Ethereum ETF verdict during this consolidation phase, and overcoming critical resistance at $0.18, where 750K addresses hold 13.3 billion DOGE, will be crucial in achieving the target price of $0.20.