Memecoins have significantly underperformed the broader cryptocurrency market, recording double-digit daily losses that surpass those of Bitcoin (BTC) and Ethereum (ETH). Leading memecoins, including Dogecoin (DOGE), Shiba Inu (SHIB), and Dogwifhat (WIF), have suffered the hardest hits, erasing much of the gains made during the Donald Trump-fueled rally weeks earlier.
Memecoin Market Cap Declines
On December 10, the market capitalization of memecoins dropped to a three-week low of $119.6 billion, a sharp decline from its previous levels. The last time the memecoin market cap dipped below $120 billion was November 27, when it rested at $118 billion. Over the last 24 hours, the memecoin sector has seen a 21% reduction in aggregate market value.
Notably, daily trading volumes nearly doubled during the same period, signaling intensified selling pressure across the sector.
Performance of Key Memecoins
Dogecoin (DOGE): The largest memecoin by market capitalization fell 5.6% over the past 24 hours.
Shiba Inu (SHIB): DOGE’s primary competitor dropped 10.4% during the same period.
Pepe (PEPE): An Ethereum-based memecoin bucked the trend, posting a modest gain of 1.7%.
Open Interest (OI) Declines in Memecoins
The crash in memecoin prices was preceded by a significant drop in open interest (OI), with Pnut (PNUT) leading the decline with a 30% decrease in OI over the last 24 hours.
DOGE: Open interest fell by over 20% to $3.1 billion, nearly six times WIF’s $519 million, which dropped 27% during the same period.
PEPE: OI decreased by 11% to $302.4 million.
A reduction in open interest indicates bearish momentum as leveraged traders close positions, anticipating further price declines.
Crypto Liquidations Hit $1.7 Billion
The broader cryptocurrency market drawdown has resulted in over $1.7 billion in liquidations of leveraged positions over the last 24 hours, with $1.3 billion liquidated in the past 12 hours alone. This marks the largest long liquidation event of the current bull cycle, according to CoinGlass.
The rapid decline in memecoin valuations, coupled with a sharp decrease in OI and massive liquidations, highlights growing bearish sentiment in the market, further amplifying volatility in the cryptocurrency sector.