- Elon Musk’s meme featuring Shiba Inu dogs sparks community interest.
- Dogecoin jumped to a three-month high as the dog-themed cryptocurrency grew 12%.
- Record leverage usage reflects the liquidation of $11 million shorts in Dogecoin.
Dogecoin (DOGE) surprised investors by leading the market rally with double-digit pull-ups for three consecutive days. While Dogecoin’s price has yet to break the annual record of $0.22, its current surge to $0.18 has been impressive.
SHIB & DOGE rise 10% after Musk’s remarks
Tesla CEO Elon Musk launched a “Department of Government Efficiency (DOGE)” campaign, sparking a surge in social mentions of The proposed department promises to “relieve the burden on the government” as Musk pledges to cut U.S. spending by $2 trillion.
The Doge Father’s news was well received by the Dogecoin community, popularly known as the DOGE Army. A few hours ago, with Dogecoin hitting a three-month high of $0.18, several cryptocurrency enthusiasts declared, “It’s DOGE season.” The bullish price action is currently accompanied by an increase in trading volume of $4,296,011,386 over the 24-hours.
Meanwhile, Shiba Inu (SHIB) sparked a 12% daily rally just hours after the DOGE price rise. According to CoinGecko, SHIB briefly hovered at $0.000019 before consolidating at $0.0000188. With 54% of SHIB holders currently in profits, Shiba Inu’s rise faces greater resistance than Dogecoin, which accounts for over 85% of DOGE custodians in profits.
Dogecoin liquidation imbalance has hit traders.
A tsunami of liquidation of short positions in the derivatives market follows the onset of strength in the price of Dogecoin. With trading volume up 184% since yesterday, Dogecoin’s stablecoin margin futures play has surpassed $7 billion, while DOGE’s open plays (OI) have increased 36.6% to $1.33 billion over the same period.
However, this rise in speculative market popularity resulted in total position liquidation reaching nearly $14 million in 24 hours, of which $11.2 million were short positions. Dogecoin short-sellers were beaten by the cryptocurrency’s bulls on expectations of an imminent market correction after DOGE hit $0.145 last Sunday.
All four major on-chain signals from blockchain analytics platform IntoTheBlock were bullish for Dogecoin. Current network growth and a small daily increase in profit holders, paired with a 3.33% daily increase in large investor transactions, are solidifying its bullish status.
Dogecoin is the second largest proof-of-work (PoW) blockchain, so transaction fees earned on the network contribute to the sustainability of the chain. This makes Dogecoin stand out from the general meme coin crowd as a relatively stable digital asset.
On the flip side
- Dogecoin has broken past the $0.175 barrier, which cryptocurrency analysts have marked as key resistance to its continued bullish momentum.
- Shiba Inu whales did not react to Dogecoin in the same way. This is because large SHIB transactions slowed by more than 5% in 24 hours.
Why This Matters
Excitement in the cryptocurrency community has sparked a price surge after Elon Musk’s Department of Government Efficiency (DOGE) endorsed Donald Trump’s campaign. However, traders are vulnerable to mass liquidations due to increased stablecoin margin leverage.
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