25 February, 2024

Solana Meme Coins Face Correction; Traders Left in Limbo Amidst Market Volatility

3 weeks ago

02 Feb, 2024

  • Solana’s meme coins experienced dwindling demand and declining prices, down 5.2% to 36.2% in 24 hours.
  • BONK had surged over 1,000% but is now nearly 70% below its all-time high.
  • Low barrier to entry in Solana’s meme coin market raises concerns about “rug pulls” and manipulation.

Solana’s meme coins, previously riding the wave of substantial gains, are now facing a notable correction. The correction, observed on Friday, has impacted top assets such as Bonk (BONK), Dogwifhat (WIF), Myro (MYRO), Samoyedcoin (SAMO), Ponke (PONKE), and Analos (ANALOS).

The once-booming demand for Solana’s meme coins appears to be dwindling, marked by a considerable price correction. These meme coins, lacking in community support, continue to see declining prices as the initial excitement surrounding airdrops fades away.

Inspired by two popular dog-themed cryptocurrencies, Shiba Inu and Dogecoin, BONK experienced a massive surge of over 1,000% in just under 90 days after its launch in 2022. However, BONK’s current value is almost 70% lower than its all-time high of $0.00004000. Similar Solana-based meme coins have also seen significant drops in value, ranging from 5.2% to 36.2% in the past 24 hours.

Source: TradingView

Technical indicators for the BONK/USDT trading pair present a muddled picture, leaving traders uncertain about whether to buy or sell. The overall sentiment remains neutral, with inconclusive readings from key indicators like oscillators. 

Moving averages hint at a potential downtrend, but some longer-term ones suggest underlying bullishness. The current price faces resistance around R1 and R2 levels, indicating potential selling pressure. The overall sentiment based on oscillators and moving averages is mixed, with some indicators suggesting a potential sell and others indicating a buy.

Solana’s meme coin market currently reflects a scenario where the barrier to entry is low, project development costs are minimal, and risks of rug pulls and short operation cycles are heightened. The environment resembles a fast-paced, “pump and dump” scenario, akin to gambling at a streetside stall.

Recently, Solana has reportedly surpassed Ethereum regarding on-chain activity, marking a significant development in the digital currency landscape. Analysts examine whether forces like genuine user engagement and airdrop farming activities drive the surge.

Crypto analyst @crypto_bitlord7 noted that traders rushing into the SOL ecosystem’s meme coins are often facing losses as liquidity shrinks and communities take control. Many meme coins are experiencing double-digit losses, highlighting the diminishing appeal to holders.

Interestingly, Solana’s native token (SOL) has resisted a correction despite the challenges faced by its meme coin ecosystem. SOL’s price has climbed 16% in a weekly timeframe, currently trading at $100.96.