Shiba Inu and Dogecoin have witnessed significant market downturns following a drop in Bitcoin prices. The prices of these meme coins have plummeted by more than 7%, leaving investors puzzled about the reasons behind this sudden decline. The main contributing factor to this crash can be traced back to Bitcoin and the substantial sell-offs impacting the leading cryptocurrency.
Impact of Bitcoin Price on Shiba Inu And Dogecoin
While the prices of Dogecoin and Shiba Inu have been on a downward trajectory, they are essentially mirroring the bearish trend of Bitcoin, which has experienced a series of sell-offs recently. The plunge in Bitcoin’s price to $57,000 was initiated by sell-offs from the US and German governments, leading to a continuous decline in its value.
Check out: Anthony Pompliano’s Advice to Investors on Buying Bitcoin During Dips
Arkham Intelligence, an on-chain data tracking platform, highlighted transactions from BTC wallets associated with the US and German governments. Notably, the German government transferred $29.95 million (500 BTC) to the Bitstamp crypto exchange. Typically, such transfers to exchanges indicate a selling intent, triggering a negative market reaction and causing a decline in BTC price.
Another noteworthy transaction involved the US government, with Arkham reporting a transfer of 249.43 BTC (equivalent to $14.38 million) to an undisclosed wallet. Although this transfer was not directed to a centralized exchange like Bitstamp, it does not rule out the possibility of the US government selling its holdings, possibly through an over-the-counter (OTC) transaction to avoid exchange fees.
Yielding to Market Pressure
While Dogecoin and Shiba Inu initially weathered the market downturn well, they have still experienced notable price drops. Dogecoin, for instance, has seen a 7% decline, reaching $0.11 after a promising start in 2024.
Similarly, Shiba Inu’s price has plummeted by 8% in the last 24 hours, bringing its value to $0.0000153, marking a more than 50% fall from its early 2024 price highs. Over the week, both meme coins have also faced setbacks, with Dogecoin and Shiba Inu dropping by 9.3% and 10.6%, respectively.
The future performance of these meme coins hinges largely on Bitcoin’s price movement, as Bitcoin often leads the market trends. If Bitcoin begins to recover, it is anticipated that Dogecoin and Shiba Inu will follow suit.
