Trump, Musk joining forces unable to turn the tide? DOGE deep in market storm

Original title: Dogecoin Down Bad: Elon Musk’s Favorite Meme Coin Sheds Post-Election Gains

Original author: Mat Di Salvo

Source:

Translated by Daisy, Mars Finance

After Trump won the election, Dogecoin soared to its highest price in three years. But with market turbulence, DOGE’s gains have all been given back.

Dogecoin has dropped rapidly: it has evaporated one-third of its market value in the past 30 days, with no gains after the election.

In the recent highly volatile cryptocurrency market environment, DOGE has suffered a heavy blow. The earliest and largest meme coin currently has a trading price of $0.166 (data from CoinGecko), which is significantly lower compared to its peak of $0.48 on November 5 last year when the pro-crypto President Trump won the election.

On Monday, DOGE fell to $0.145 at one point, hitting its lowest level since October last year. Despite a 6% rebound in price today, temporarily halting the recent plunge, the overall situation is still far from optimistic: this cryptocurrency, ranked ninth in global market capitalization, is now priced below its level a year ago.

In the derivatives market, the open interest of Dogecoin’s futures contracts has also plummeted, currently standing at only $1.37 billion, data from CoinGlass. In January this year, as the frenzy swept through the crypto market, Dogecoin’s total futures bets once soared to $5.28 billion. Now, the value of open interest in the U.S. market has fallen below the level on Election Day.

As President Trump continues to release messages regarding trade tariffs and triggers trade wars with neighboring countries, funds in the derivatives market are withdrawing. Faced with market uncertainties brought by the new American leader, traders are selling off risk assets, including US stocks. Market panic intensifies, especially after Trump refused to rule out the possibility of an economic recession in a weekend interview.

The S&P 500 and Nasdaq suffered setbacks, but the decline in the cryptocurrency market was even more severe. Meme coins based on Internet meme culture and subcultures have recently experienced a sharp drop, while Bitcoin has also fallen from its all-time high of $108,000 to below $77,000 on Monday night.

Dogecoin is different from other meme coins in that it operates on its own blockchain. On the eve of Election Day, the coin once again showed strong performance, partly due to the renewed interest from the world’s richest person, billionaire entrepreneur Elon Musk, in Dogecoin. His comments at a Trump campaign rally boosted the coin’s price, and after Trump’s victory, Dogecoin continued to rise, reaching a new high in three years.

The head of SpaceX and Tesla, who has now become a close advisor to President Trump, first showed interest in Dogecoin during the COVID-19 pandemic, directly driving up the value of the coin.

Cryptocurrency traders had hoped that Dogecoin would replicate its 2021 peak in this cycle, but currently, its price has dropped by 78% from its historical high of $0.73.

Despite Musk now heading a government agency named the Department of Government Efficiency (DOGE) after the dogecoin**code (DOGE), this political association has not helped the coin price rise, but instead made headlines due to its controversial moves, causing market unrest.

Decrypt recently interviewed some well-known Doge meme culture and Dogecoin supporters to discuss Musk’s DOGE plan. Despite Dogecoin’s meme culture being known for its relaxed and fun atmosphere, its increasingly close connection with politics has caused divisions within the Dogecoin community.

Meanwhile, the US market has recently seen a wave of cryptocurrency ETF applications, including a potential application for a Dogecoin ETF. Earlier this year, Bitcoin and Ethereum ETFs were approved, but traders received bad news on Tuesday: the US Securities and Exchange Commission (SEC) has postponed a decision on Grayscale’s Dogecoin ETF application, with a new deadline extended to May 21.