Memecoins
Bitcoin and Dogecoin have not joined the meme stock party. here’s why
This week, meme stocks returned to the spotlight after Roaring kittenthe investor behind the GameStop saga in 2021returns to social media and sparked a new frenzylifting other meme stocks.
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However, the price of Bitcoin and memecoins, such as Dogecoin and Shiba Inu, have not increased significantly. As of Wednesday afternoon, Dogecoin and Shiba Inu were both up 2.5% and 1.5%, respectively, while leading cryptocurrency Bitcoin was up more than 5%.
During GameStop’s hike on Monday, Doge and Shiba jumped almost 6% and 5%, respectively, but it’s not extraordinary given how memecoins have rallied in the past after meme stocks’ meteoric rise.
The GameStop saga contributed greatly to Doge’s success in 2021. Dogecoin attracted the attention of investors who were looking for a cryptocurrency equivalent to the meme stock GameStop. Just as GameStop was reaching its peak, Dogecoin began to gain traction, peaking in May 2021 at $0.74 per coin.
But this time, nothing like that happened.
When meme stocks returned to action earlier this week, memecoins like Floki and Popcat saw double-digit gains, but they don’t have the same market share and popularity as Doge and Shiba. To everyone’s surprise, Dogecoin and Shiba Inu remained unmoved by the meme stock craze, as if they had no connection to it.
This is because crypto has evolved and become more macro, said Pat Doyleblockchain researcher at Amberdatain an email.
The recent rally in meme stocks was not expected to last as long as it did in 2021, as some experts have mentioned. Doyle echoed the same sentiment by saying that 2021 had many catalysts, including covid, remote work, increased time online and the issuance of stimulus checks, among others, and that none None of them would happen in 2024.
However, this does not mean that these trends do not affect crypto at all, as different pockets of crypto will react differently to stock market movements, he clarified.
“A memecoin called GME (no relation to the title) saw insane returns after Roaring Kitty returned to Twitter. However, the rest of crypto assets in DeFi segments remained stable,” he wrote.
“While the crypto space has grown and seen more adoption and maturity, the cost of deploying a memecoin is relatively low, which is why we are seeing such growth in this segment.”
Cryptocurrency has become more mainstream this year, as permitted by the Securities and Exchange Commission. Spot Bitcoin ETFs in January. This resulted in financial giants like BlackRock and Fidelity are launching into the world of blockchain and cryptography and send crypto to new heights.