Dogecoin Demand Crashes India’s Largest Crypto Exchange

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In Brief
  • Indian crypto exchange WazirX has struggled to meet the skyrocketing demand for Dogecoin.

  • Interpreting the surging volumes as a cyberattack, the exchange’s system blocked access for some users.

  • Dogecoin has risen 24,610% in the past year, reaching an all-time high of $0.65 on May 6.

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India’s largest crypto exchange by trading volume, WazirX, has been struggling to meet the skyrocketing demand for Dogecoin.

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Global DOGE trading volumes tripled between May 3 and 5 to over $42 billion. According to WazirX Founder and CEO Nischal Shetty, this caused the exchange’s systems to crash because the surging volumes were wrongly perceived as a cyberattack;

“On May 4, one of our systems—on detecting high traffic—wrongly marked it as bad traffic and started blocking the requests,” he said. “It was good traffic, and this error caused our users to have intermittent access to the app.”

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WazirX’s issues

Shetty remarked that the Dogecoin surge even “caused an almost decade-old company like Robinhood to go down.” He added that his company is only three years old, but that no other crypto exchange in India has seen that amount of traffic.

Since January, the company has grown over 300%. “We’re seeing a new all-time-high everyday in terms of trading volumes, active users, and traffic on WazirX,” Shetty exclaimed. However, as the company grows, WazirX has found it challenging to keep up with the growing demand. Dogecoin aside, this isn’t the first time the exchange has had issues.

Many complaints have surfaced on crypto user chat groups on Telegram and Reddit. Common grievances include security issues with OTP authentication, as well as a lack of customer support. These are on top of the most prevalent issues of their servers struggling with higher trading volumes.

For instance, on April 4, an outage occurred on WazirX when trading volumes crossed $270 million. The exchange was out for over a day before these issues got resolved. Users complained about deposits getting stuck when another outage hit in early May. Shetty claimed they had issues with a payment partner that day.

This highlights another potential weak point. Regulatory uncertainty in India has made payments processors and banks more hesitant to engage with cryptocurrency exchanges. As dependence upon them grows more uncertain glitches in withdrawal and deposits from crypto wallets have increased.

Dogecoin surging

Meanwhile, the Dogecoin saga continues. In the past year, the price of DOGE has risen by 24,610%, according to CoinGecko. But as recently as January of this year, Dogecoin was trading for a fraction of a penny. In February, the price rose significantly to over $0.05. However, in April, Dogecoin really took off, increasing in value eight-fold to $0.40, before retracing. 

At that point, it took references by stalwart fans Mark Cuban and Elon Musk to trigger a renewed bull run. Dogecoin has thus far reached an all-time high of $0.65 on May 6 but has pulled back some to $0.60.

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Nick is a data scientist who teaches economics and communication in Budapest, Hungary, where he received a BA in Political Science and Economics and an MSc in Business Analytics from CEU. He has been writing about cryptocurrency and blockchain technology since 2018, and is intrigued by its potential economic and political usage. He can best be described as an optimistic center-left skeptic.

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