Dogecoin Prices Swing Wildly Over Fake News
Dogecoin, one of the most popular meme coins in the crypto sector, recently experienced a wild price swing due to a baseless social media rumor. The rumor, which falsely claimed the death of Dogecoin’s beloved mascot, Kabuso, led to a temporary surge in the price of DOGE by 9% to 8.3 cents.
The rumor was initiated by a pseudonymous user who shared a misleading screenshot on Twitter. However, the user later admitted the screenshot was fake, deleted the post, made their account private, and eventually deleted the entire account. This incident underscored the susceptibility of crypto markets to misinformation and highlighted the volatile nature of memecoin prices, which are often driven by social metrics.
#ClownShowAlert Name and Shame pic.twitter.com/R06YWw41KJ
— snailnews (@snailnews_) January 9, 2024
The price of DOGE fell soon after the rumor was debunked, retracing to approximately $0.079 at the time of writing. Despite the temporary uptick in DOGE’s price, the overall outlook for DOGE appears bearish, as indicated by multiple lower lows and lower highs shown by DOGE’s price movement over the last month. The Relative Strength Index (RSI) of DOGE also declined, showing that the bullish momentum around DOGE had fallen.
This incident occurred amidst another fake news event that affected the whole crypto market, related to Bitcoin spot ETFs. The high fluctuation of DOGE’s price, however, allowed many addresses to become profitable, enabling them to sell their holdings.
Despite the negative sentiment around DOGE on social media, the total number of addresses holding DOGE continued to grow. This suggests that many addresses were continuing to accumulate DOGE, even amidst the price volatility.
These incidents serve as a reminder of the crypto market’s vulnerability to news misinformation, especially when it comes to Meme coins. For example, in 2017, a rumor circulated on social media claiming that the founder of Ethereum had died in a car crash, and this fake news led to a significant impact on Ethereum’s price. In 2021 a fake press release claimed that Kroger, a major grocery chain, would soon accept Bitcoin Cash as a form of payment which led to a brief 5% jump in the price of Bitcoin Cash. A similar hoax in 2021 involved a fake press release claiming that Walmart was partnering with Litecoin. This fake news led to a brief 30% increase in the price of Litecoin.
In the wake of these events, the future of Dogecoin remains uncertain. While some analysts predict a potential downturn, others remain optimistic, predicting a monumental breakout. As the crypto market continues to react to ongoing news breaks, volatility is expected to remain high.
Angel Marinov is the Managing Editor at Coinlabz. With extensive knowledge of crypto payments and blockchain use cases, Angel is a trusted source of accurate and timely information
