GameStop causes meme coin values to plummet by over 10
The crash of GameStop’s stock on June 7 had a ripple effect on meme coins, causing a significant decline in their value. While not as drastic as GameStop’s fall, popular meme coins like Pepe, Dogewheat, Floki, and Bonk all experienced drops of over 10%.
The market’s unpredictability was on full display as GameStop’s stock surged 47% the day before a live broadcast by Keith Gill, also known as ‘Roaring Kitty,’ who had been a key figure in the GameStop rally. However, the stock price plummeted by 40% following the broadcast, which did not provide any new information. This volatility also impacted meme coins, which had been riding on the coattails of the meme stock rally.
Data from CoinMarketCap on June 8 revealed that Dogecoin and Shiba Inu had fallen by 7.56% and 6.23% respectively. Pepe dropped 10.82%, Dogewheat 12.47%, Floki 12.93%, and Bonk 11.35%, all showing declines in the early 10% range.
Analyst Il Capo described the situation as a “shakeout” amidst an uptrend, emphasizing a support test for Solana, the platform behind major meme coins.
The entire crypto market was impacted by this downturn, resulting in a $65 billion decrease in less than a week. This led to a shift of capital into stablecoins or safer investments, further contributing to the decline of meme coins. Social volume for these altcoins also dropped by more than 20% in the last 24 hours, reflecting negative sentiment alongside the price decline.
Keith Gill’s return to social media after three years reignited excitement in GME trading, leading to frequent trading halts on traditional exchanges. This sparked a surge in meme coin activity amidst a bullish crypto market.
Notable gains were seen in meme coins like the Solana-based Roaring Kitty (KITTY) coin, which surged nearly 300% to around $0.0344 by Friday. The Ethereum-based Roaring Kitty (ROAR) coin also jumped over 126%, reaching approximately $0.00154. Additionally, the Solana-based GME (GME) coin experienced a significant rally, increasing over 115% to about $0.025.
The rise of these parody meme coins underscores the intense FOMO in the crypto market, with the meme coin industry’s market cap reaching nearly $57.6 billion and a daily trading volume exceeding $9 billion.
As the market dynamics continue to shift, there is speculation that the meme coin frenzy could lead to a new altseason. Bitcoin’s dominance appears to be wavering, with Ethereum (ETH) and BNB making significant gains, hinting at a potential market shift.
In the midst of these developments, digital artist Beeple’s latest artwork “CURIOSITY KILLED THE CAT” has sparked controversy, with some interpreting it as a commentary on the risks associated with the hype surrounding meme stocks and cryptocurrencies, particularly in light of Roaring Kitty’s influence on the market.
There are concerns about how Beeple’s provocative imagery could impact GameStop’s volatile stock price, while some experts believe that Roaring Kitty’s return could signal a forthcoming meme coin supercycle.
Overall, the landscape of meme coins and the broader crypto market continues to evolve, with celebrities and artists increasingly drawn to the space for various reasons.
