Meme Coin Rally Flares Up Then Fizzles, Slams on the Brakes in Just One Day

▲ Dogecoin (DOGE), Shiba Inu (SHIB), Pepe (PEPE)/ChatGPT-generated image     ©

The meme coin rally that ignited the previous day hit the brakes within just one day, signaling that short-term overheating is becoming a reality.

As of 9:05 a.m. KST on February 16, according to CoinMarketCap data, Dogecoin (DOGE) was trading at $0.1025, down 7.75% over the past 24 hours. Its market capitalization stood at $17.307 billion, with trading volume reaching $2.554 billion. Shiba Inu (SHIB) fell 6.77% to $0.000006554, while Pepe (PEPE) plunged 8.89% to $0.0000054428. Bonk dropped 9.01%, and Pudgy Penguins (PENGU) slid 10.02%, with most top meme coins posting concurrent losses.

The primary driver behind the sharp decline appears to be profit-taking following the previous day’s short-term surge. Many tokens had recorded double-digit gains over the past 36 hours, prompting a wave of selling from investors seeking to lock in quick profits. Meme coins, which tend to react more to sentiment and liquidity than fundamentals, often experience rapid pullbacks after steep rallies.

A broader market risk-off mood also weighed on prices. As Bitcoin failed to firmly establish itself above the $70,000 level and entered a correction phase, capital swiftly flowed out of the more volatile meme coin sector. Meme coins typically behave like leveraged “beta assets” during bull markets, amplifying gains, but they are often the first to be sold during downturns.

However, not all tokens are moving in a uniform downtrend. PIPPIN has surged 143.37% over the past seven days, maintaining strong short-term momentum, while some small- and mid-cap meme coins continue to see rising trading volumes and heightened volatility. This suggests a rapid sector rotation among individual tokens rather than a complete collapse of the meme coin theme.

The key variable going forward will be Bitcoin’s direction. If Bitcoin regains and holds above the $70,000 level, speculative capital may once again flow into meme coins. Conversely, if further corrections continue, meme coins could experience amplified declines alongside increased volatility. In the short term, the market appears to be undergoing a cooling-off phase, while in the medium term, overall liquidity trends will likely determine the trajectory.

Disclaimer: This article is for investment reference only, and no responsibility is taken for investment losses based on it. The content should be interpreted solely for informational purposes.