Dogecoin Hashrate Plunges as DRC-20 Token Craze Cools Down
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Dogecoin has experienced a sharp decline in its hashrate over the past day. This drop follows a period of frenzied excitement surrounding the rise of DRC-20 tokens, which fueled a surge in transactions and subsequent hashrate growth. However, as interest in these tokens wanes, Dogecoin’s hashrate has taken a nosedive, returning to its previous levels.
When the Ordinals and BRC-20 craze first began, investors were quick to jump on the Bitcoin bandwagon, leading to a flurry of transactions on the network. Soon, developers saw the potential and extended this concept to other cryptocurrencies, such as Dogecoin and Litecoin, which operate on similar principles.
The Birth of DRC-20 Tokens on Dogecoin
To enable the seamless transfer of fungible tokens on the Dogecoin network, enterprising developers introduced DRC-20 tokens, taking inspiration from Ethereum’s widely adopted ERC-20 standard. As the popularity of these tokens soared, the number of transactions on the Dogecoin network followed suit. Reports show an astonishing 60-fold increase in DOGE transactions within a mere 20-day period, which is solely attributed to the emergence of DRC-20 tokens.
Naturally, the surge in transactions had a direct impact on Dogecoin’s hashrate, which measures the computational power dedicated to mining and securing the network. CoinWarz data indicates that on May 17, amidst the peak of this euphoria, the hashrate skyrocketed to over 1 petahash per second (PH/s). Miners eagerly seized the opportunity to capitalize on the increased workload, further reinforcing the network’s resilience.
However, the recent drop in Dogecoin’s hashrate coincides with a decline in interest surrounding DRC-20 tokens. As investors shift their attention to newer trends and shiny novelties, the hashrate has taken a hit, plunging by over 34% in the last 24 hours. Currently, the hashrate has settled back to approximately 470.70 terahashes per second (TH/s), marking a return to its pre-euphoria levels.
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