CoinDesk Analysis Team
CoinDesk
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Meme coins led by Solana-based dogwifhat surged, outpacing other niches such as DeFi and exchange tokens.
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Bets on DOGE-tracked futures jumped to a record $2 billion, and some trading firms warned of a pullback in recent gains as bitcoin and ether price action showed signs of exhaustion.
Meme coins led by Solana-based dogwifhat (WIF) surged for the second day to lead as a category as the broader market remains little changed ahead of the long weekend in the U.S., Europe and parts of Asia.
Bitcoin (BTC) traded around $70,000 million during the Asian morning hours on Friday, showing little change in the past 24 hours. Ether (ETH), Solana’s SOL and Cardano’s ADA slid 1%, while Bitcoin Cash (BCH) added 4% to continue its Thursday rally.
The broad-based CoinDesk 20, an index of the largest tokens minus stablecoins, was down 0.56%.
CoinGecko data shows that the meme coin category surged 8% on average, outpacing more serious niches such as decentralized finance, yield farms, and exchange tokens.
Meme tokens started to run early Thursday amid speculations of DOGE being used on an upcoming payments service of social application X, although there has been no official communication from the company.
Bets on DOGE-tracked futures jumped to a record $2 billion, indicative of expectations of future price volatility with a bias toward longs.
Dog-themed tokens such as Floki (FLOKI) and WIF jumped as a beta bet to dogecoin. WIF flipped Pepecoin (PEPE) to become the third-largest meme token by market capitalization, crossing the $4 mark on Thursday.
Meanwhile, some trading firms warned of a pullback in recent gains as bitcoin and ether price action showed signs of exhaustion.
“The price rally has been exponential in Q1, and there are signs of exhaustion,” Singapore-based QCP Capital said in a Telegram broadcast Friday. “ETH risk reversals are skewed to the downside at -8%, indicating some fear. Funding and forwards remain very elevated, which means that speculators are still paying high prices to keep their leveraged longs.”
“While we remain bullish, we are cautious about leverage,” the firm concluded.
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