- Dogecoin (DOGE) price tanks by over 9% as Twitter restores original logo, leading to a sell-off by whales.
- Popular crypto analyst Ali Martinez had warned of a possible retracement, and on-chain data provider Santiment shared some interesting insights behind this week’s DOGE price rally.
Dogecoin (DOGE) has experienced a significant dip in price, declining by over 9% following Twitter’s decision to restore its original logo. DOGE is currently trading at $0.085 and has a market capitalization of $11.8 billion.
Twitter owner Elon Musk previously changed the logo to a Shiba Inu “meme” on Monday, leading to a surge in DOGE’s price to 10 cents. This move created massive euphoria within the Dogecoin community, but the excitement was short-lived, and the price has since dropped significantly.
It never fails! Sell when FOMO, buy when fear. https://t.co/8F5ltPvYoe
— Ali (@ali_charts) April 6, 2023
Elon Musk has been an ardent supporter of Dogecoin and has made several remarks regarding his love for the meme coin. While explaining his decision to change the Twitter logo, he stated that it was to keep a promise he made during an earlier conversation with a Twitter user. The Dogecoin community is hopeful that Musk will make DOGE the currency of Twitter in the future, but the move may attract regulatory scrutiny, and it remains unclear how Musk intends to pull it off.
The surge in the price of DOGE also caused an increase in social volumes by more than 30% in a single day. Popular crypto analyst Ali Martinez had warned of a potential retracement two days before the price drop.
Santiment, an on-chain data provider, shared some interesting insights behind this week’s DOGE price rally. The company’s report revealed that Dogecoin whales, close to Elon Musk, cashed out on the price pump. The report noted that when Musk does something on Twitter, it is usually for the purpose of getting laughs, attention, or money. The report went on to explain that there were signals that top players were exiting the asset while taking heavy profits.
The report also revealed that three major metrics surged at the same time: active addresses and circulation, trading volume and transaction volume, and whale transactions. Santiment added that when these three metrics all spike together during a time when the asset is going on a decoupled surge independent from the rest of the markets, it is a solid indication that a local top is forming, and profit-taking is a wise decision.
Overall, DOGE’s price drop following Twitter’s restoration of its original logo is indicative of the volatility of meme coins. Although they often experience significant price increases due to social media hype, they are also susceptible to sudden price drops. The future of DOGE remains uncertain, and it remains to be seen if it will recover from the recent dip in price.