Dogecoin Open Interest Falls 67% Amid Declining Investor Confidence

Investor interest in Dogecoin is decreasing sharply, with open interest dropping 67% from $4.07 billion in December 2024 to $1.33 billion by February 2025. This decline indicates growing market caution and reflects a broader trend of reduced activity in the crypto market.

Key Points on Dogecoin's Decline

Open interest measures active contracts; a decline suggests traders are avoiding new positions.
The drop in Dogecoin's open interest signals weak investor confidence.
Many investors are shifting focus to more stable assets amid market turbulence.
Bitcoin and Ethereum maintain higher open interest compared to significant declines in smaller altcoins like Dogecoin.

Network Activity Decrease

Dogecoin's network activity has also fallen significantly, with active addresses dropping from nearly 1.3 million in November 2024 to 130,000 in February 2025, marking a 95% reduction. This suggests fewer users are interacting with the platform, impacting potential future growth.

On-chain data shows decreased transaction frequency, reflecting reduced engagement from retail and institutional investors.
The decline indicates a lack of new investors joining the network.

Meme Coin Struggles

Dogecoin is not alone in facing challenges; other meme coins that saw price increases in 2024 are also struggling early in 2025. Investors who profited from last year's rally are now cashing out, contributing to fading hype around meme coins.

Analysts note that without strong community support and new users, joke coins may continue to lose value.
The competition for investor attention is intensifying as new projects enter the market.

Institutional Interest Remains

Despite declining retail interest, Dogecoin still attracts some institutional interest. Grayscale Investments established a Dogecoin Trust in January 2025, indicating ongoing belief in its potential. However, it remains uncertain if this institutional backing can compensate for falling retail support.

The future of Dogecoin will depend on a market recovery and renewed interest from ordinary investors.