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▲ Bitcoin (BTC), Dogecoin (DOGE), Shiba Inu (SHIB), Pepe (PEPE), Memecoin, Bear Market/AI Generated Image ©
The memecoin market has once again been swept by strong selling pressure. Major memecoins such as Dogecoin (DOGE), Shiba Inu (SHIB), and Pepe (PEPE) all declined as the CLARITY Act, a US cryptocurrency market structure bill, failed to pass a procedural vote in the US Senate, and risk-off sentiment spread ahead of the Fed's interest rate decision. Dogecoin, in particular, continued its bearish trend among top market cap memecoins, even threatening the $0.08 mark.
According to CoinMarketCap at 7:25 AM on the 16th, the total market capitalization of memecoins decreased by 1.27% over 24 hours to $28.22 billion. In contrast, the 24-hour trading volume increased by 4.83% to $2.8 billion, indicating an expansion of trading activity amidst price declines. Dogecoin fell by 5.70% to $0.07944, with its decline over the past 7 days reaching 11.67%. Shiba Inu dropped by 7.09%, Pepe by 4.95%, Official Trump (TRUMP) by 7.79%, Pudgy Penguin (PENGU) by 5.42%, Bonk (BONK) by 6.92%, and Floki (FLOKI) by 6.56%.
The rejection of the CLARITY Act was a major factor in the overall market plunge. On the 15th, the U.S. Senate failed to clear the 60-vote threshold in a procedural vote to advance the CLARITY Act. According to Reuters, the vote was 50 in favor and 49 against, falling short of the 60 votes needed to advance the bill. As the vote failed, Bitcoin dropped by over 5%, and selling pressure spread to cryptocurrency-related stocks.
The macroeconomic environment also acted unfavorably for memecoins. Ahead of the CLARITY Act vote, the U.S. 10-year Treasury yield surged close to 5%, and international oil prices rose, dampening investor sentiment for risk assets. Furthermore, the market is awaiting the Fed's interest rate decision on the 16th. With rising interest rates, oil prices, and regulatory uncertainty all highlighted simultaneously, the decline in relatively volatile memecoins appears to have widened.
Negative news specific to certain assets also coincided. Earlier, concerns about institutional demand for Dogecoin grew due to Bitwise's decision to liquidate and close its Dogecoin ETF. On CoinMarketCap, DOGE appeared as one of the most viewed assets, yet its price fell by over 5%. However, while the overall market showed weakness, some assets like Nitro (NITRO) with a 33.37% increase and NEKO (NEKO) with a 26.31% increase recorded double-digit gains, indicating a selective shift of funds towards some smaller assets.
The biggest remaining variable this week is the Fed. With the regulatory upside weakened by the CLARITY Act's rejection, if monetary policy also acts unfavorably for risk assets, the high volatility of memecoins could persist. Conversely, if Treasury yields and Bitcoin stabilize after the Fed's announcement, there's a possibility of a short-term rebound, especially for assets that experienced significant declines. For now, key indicators to gauge investor sentiment include whether the memecoin market cap defends the $28 billion mark, changes in market trading volume, and whether Dogecoin recovers to $0.08.
*Disclaimer: This article is for investment reference only, and we are not responsible for any investment losses based on it. The content should be interpreted for informational purposes only.*
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