Dogecoin and Shiba Inu, two popular meme cryptocurrencies, recently took a major dive, losing over 10% of their value. This downturn happened amidst rising global tensions.
The Crash: Geopolitics and Market Fear
The price drop started around June 13th, coinciding with increased conflict in the Middle East. The escalating situation between Israel and Iran created widespread market uncertainty, causing both Dogecoin and Shiba Inu to plummet. The ongoing conflict and the potential for a larger war fueled further negative sentiment.
Oil Prices and Interest Rates
Adding to the woes, soaring oil prices due to the geopolitical instability are causing inflation concerns. This could lead the US Federal Reserve to maintain or even raise interest rates. Higher interest rates typically reduce investment in riskier assets like cryptocurrencies, putting further downward pressure on Dogecoin and Shiba Inu.
Dogecoin’s Troubled Waters
Data shows Dogecoin’s open interest (the total value of outstanding contracts) fell significantly, nearing its December 2024 low. Trading volume also dropped dramatically, suggesting a lack of investor confidence. Many traders are currently betting against Dogecoin (shorting).
Shiba Inu’s Situation
Shiba Inu also experienced a decrease in trading volume. While many are also shorting Shiba Inu, its open interest actually increased slightly, which could be a positive sign.
Potential for a Comeback?
Despite the recent crash, some analysts remain optimistic. One analyst believes Dogecoin has reached its bottom and is poised for a significant price increase. Another analyst points to potential positive signs for Shiba Inu, suggesting a possible price rebound. These predictions, however, are speculative and should be taken with a grain of salt.
