Dogecoin (DOGE), the most popular memecoin in the cryptocurrency market, is experiencing an interesting development in its metrics, according to market analysts. So, what do these developments signify?
Coinalyze data reveals that DOGE’s funding rates have recently turned negative, reaching -0.0027% as of Thursday. These levels were last seen in October 2023. Funding rates refer to periodic payments made by traders based on the price difference between futures and spot markets.
Although these ratios are not significantly high, they indicate a bearish sentiment in the market when they consistently decrease along with the decline in prices. Last week, DOGE lost 12% of its value, wiping out all the gains it had made since March.
The open position of DOGE, which represents the number of uncompleted futures contracts, has also decreased from approximately $800 million on Monday to $611 million as of Thursday. This decrease further indicates a decline in demand for this token.
During a few eight-hour trading sessions in March, rates briefly turned negative, but not for an extended period like what has been observed this week.
Memecoin tokens have suffered losses of up to 40% over the past seven days. Investors are shifting their focus from riskier tokens to Bitcoin and stablecoins.
“When the price of Bitcoin drops, memecoins not only follow suit but also lose an even larger portion of their value,” said Neil Roarty, an analyst at investing platform Stocklytics. “Any plans for a Memecoin summer may have to be put on hold.”
Please note that this article is not investment advice.
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