Although trading relatively flat for the last couple of weeks, Dogecoin (DOGE) hasn’t been taking a nap in the meantime.
Dogecoin has been remarkably resilient as crypto-markets have turned upside down over the past few days. It is even trading at a one week high. Sitting 5th in market cap, it is quietly distancing itself from Nextcoin (Nxt) and while not there yet, closing in on Peercoin for 4th (really 3rd when only considering true cryptos. That’s the next spot after Litecoin).
Unlike exotic altcoins that have dropped just as quickly as they’ve spiked, DOGE has preserved the majority of its gains from 2-3 weeks ago. The longer it trades at these levels, the more likely it is to hang on to them and use this floor as solid ground for leaping higher.
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Even during the flat trade, DOGE has dominated trading volume amongst altcoins, even when measuring in Bitcoin (BTC). Today for example, its trade with BTC is nearly 7x higher than LTC’s with BTC on Cryptsy (again, we’re measuring volume in BTC, not DOGE). Even against LTC, DOGE liquidity is abundant, with a spread of only 0.2% from the mid-point. The value observed was actually lower during other periods today.
It’s no wonder then that Cryptsy has had trouble keeping pace. The combination of intrinsically high volume, compounded by the micro-denominated value of DOGE, has resulted in astronomical quantities of DOGE for them to process. Thus, Cryptsy’s hot wallet is showing 2 symptoms of overload: First, the wallet fell behind from the rest of the network as it takes longer to process blocks. Second, the size of the wallet database became so large that it further slowed down the system, thus completing a vicious cycle as the wallet falls further behind the rest of the network.
To provide much needed relief, Cryptsy has created a new hot wallet for new addresses to be generated. Its use is optional and the old wallet can still be used. Depositors are also advised to send single large transactions instead of multiple fragments that can clog the network.
For up to date market info on Dogecoin, check here.