The meme coins sector of the crypto market is taking a big hit amidst a wider price decline in the industry. Recent lackluster price action has seen most cryptocurrencies struggling to maintain bullish price action for the majority of last week.
This price decline has now been exacerbated with the latest escalation of tensions in the Middle East which seems to have rattled investors and driven down prices of popular meme coins.
As news broke of Iranian fighter drones on their way to Israel, meme coins like Dogecoin (DOGE), Shiba Inu (SHIB), and Dogwifhat (WIF) saw price drops of over 10% in a matter of hours.
Meme Coins Bleed
Meme coins are one of the most volatile investment assets with quick rises and crashes. The reality is their values are largely driven by hype, speculation, and quick changes in investor sentiment rather than real-world utility or adoption.
According to Coinmarketcap, the meme coin market has fallen by 12% in the past 24 hours and the downward pressure is likely to continue. Interestingly, most meme coins have been registering price declines since the beginning of the month as activity and social media hype began to wane.
DOGE (DOGE), Shiba Inu (SHIB), Dogwifhat (WIF), PEPE, and Floki, are currently down by 18%, 23%, 33%, 25%, and 32% respectively in the past seven days.
DOGE, the original meme coin, has dropped by a significant 12% in the last 24 hours. Particularly, DOGE fell to $0.135 on April 13 at 5:30 pm Eastern Time for the first time in three weeks. Dogecoin has also seen its weekly active trader count plunge and was recently overtaken by DOG and DEGEN.
Bitcoin is now trading at $64.390. Chart: TradingView
SHIB and WIF, two of DOGE’s main competitors in the meme coin space, have also posted substantial losses. These coins tend to trade in tandem with DOGE. At the time of writing, SHIB is down 14% while WIF has dropped over 11% in the past 24 hours.
PEPE has not been immune to the market sell-off. The meme coin has plunged 14% in the last 24 hours, extending its week-long slump. FLOKI and BONK follow behind with a 15% and 11% fall respectively in the same timeframe.
Rebound Or Further Decline?
Recent market fundamentals point to a continued selloff in the short term. Investors tend to dump risky, speculative assets during geopolitical crises and market turmoil.
According to Coinglass, the open interest on DOGE, WIF, PEPE, and SHIB positions has fallen by 23.91%, 13.78%, 36.62%, and 18.68% in the past 24 hours. This suggests money flowing out of these assets and traders exiting positions.
On the other hand, the volatile nature of cryptocurrencies means the meme coins could flip into a bullish trajectory as soon as possible.
Featured image from Pixabay, chart from TradingView
