The top memecoin has tumbled sharply, about 10 per cent in the last 24 hours, slipping down to 12th position in the terms of market capitalization from 10th earlier.
Not only memecoins, other major tokens and altcoins have fallen sharply in the last 24 hours, thanks to the rising geopolitical worries and inflationary concerns.
Sathvik Vishwanath, Co-Founder and CEO of Unocoin, said that the entire crypto market is in a consolidation phase for the last few weeks. Altcoins in most cases are coherent with Bitcoin.
The marketcap of the numero uno joke coins has slipped below $17 billion. Its largest peer Shiba Inu is holding on the 14th spot with a total valuation of little more than $13 billions. The difference between the two is less than $4 billion.
However, both Dogecoin and Shiba Inu are attracting investors at lower levels as the volumes counters have spiked more than 125 per cent and 55 per cent in the last 24 hours, respectively.
Coins without any utility are mostly sold due to the market hype, and because now we are getting into bear market weighting is not reflecting on price. But it still has a solid community, said Kumar Gaurav, Founder and CEO of Cashaa.
Market experts say that memecoins like Dogecoin and Shiba Inu are community driven coins and lack sound fundamentals with utility which adds value to them.
Pratik Gauri, CEO and Founder 5ire said memecoins score a lot of value in the crypto market, but the underlying model behind them is that of a meme and untamed speculation — nothing less, nothing more.
“We can try and predict their rise and fall, but essentially you have to admit that it will be fruitless because we have nothing to go on other than their popularity,” he added.
Shiba Inu, one of the latest meme sensation, has crumbled over 70 per cent from its peak value $0.00008 hit in October last year, to $0.00002325 on Tuesday.
On the contrary, Dogecoin has tumbled about 82 per cent from the all time peak of $0.6848 hit in August 2021 trading at $0.1254 on Tuesday, showing more weakness from the peak. However, both the tokens have taken a strong hit lately.
“Both are dwindling, but in recent times we have noticed that the Shiba army on the internet has become stronger due to its reach than Dogecoin,” said Kumar Gaurav from Cashaa.
However, memecoins are deflationary, which means their supply is unlimited.
“We cannot say that Dogecoin is weaker compared to Shiba Inu,” said Vishwanath from Unocoin. “They have an unlimited supply, there is not always an equal demand for it.”
On the other hand, just as the other crypto market is in the consolidation phase, the trade volume of Dogecoin and Shiba Inu has been seen lower in the past. Once the market gets back on track, investors may see the community jumping back.
When looking at the investor perception, more of them favour Dogecoin gaining in value by the end of this year than Shiba Inu, said Gauri from 5ire. But, he thinks the variety and the opportunity to earn is greater with Shiba Inu.
Market experts suggest that investors should keep off from the memetokens as such tokens are moved either by euphoria or by the big whales holding them.
“When the market is in a consolidation phase, it is not recommended to hold assets on smallcap coins, because it is easier to lose a hand with it”, Vishwanath said. “Buying memecoins in volatile times is definitely not a good idea.”
Though, others argue that it gives a buying opportunity after a sharp correction and long-term players can average their cost. It is always better to stay vigilant until one sees a clear signal.
It is essential that one does it with their own ability to withstand loss and do it for the long term, said Gauri. “It is also crucial to diversify your portfolio and not be swayed by the market sentiment or try to time the market.”