- Memecoins are leading altcoins, signaling a possible “meme-driven” cycle after the election.
- However, an essential condition must be met for this to become a reality.
Memecoin’s dominance, now approaching 3%, mirrors that of mid-March levels when Bitcoin (BTC) surged to its all-time high of $73,000, coinciding with a total market cap near $2.7 trillion.
In early April, the market share of meme tokens peaked at 4%, fueled by the reallocation of their capital towards large-cap tokens.
As the election approaches, BTC is poised to attract significant liquidity, sparking speculation over whether memecoins are poised for a substantial rally. If historical trends continue, we could see the memecoin cycle peak by mid-November.
Memecoins outperform altcoins
With 60% of the top 10 memecoins in the green, it is evident that memecoins are drawing liquidity from Bitcoin, while altcoins continue to struggle to garner similar interest.
Leading the pack is DOGE with a weekly gain of more than 24%, thus securing its place as the best performer over the last seven days. Overall, such spikes suggest that the current cycle may be reaching its peak, as retail investors begin to hedge against volatility.
However, this market cycle is more influenced by macroeconomic factors, especially less than a week before the election.
Source: SpotOnChain/X
One of the main catalysts for Bitcoin’s rise to its ATH was BlackRock’s $872 million inflow in a single day, setting a record for the highest daily inflow. ETH ETFs, on the other hand, saw a modest inflow of $4.4 million, reflecting calmer interest.
This trend reinforces AMBCrypto’s earlier hypothesis: as in previous cycles, memecoins are outperforming altcoins in attracting capital during this bullish phase.
However, for a full memecoin cycle to take off, Bitcoin will likely need to reach a market high. Current net deposits on exchanges remain elevated, suggesting increased selling pressure, but the MACD’s bullish crossover suggests room for further upside before any major correction.
With FOMO driving BTC higher, a resistance level near $75,000 could come into play after the election. If Bitcoin peaks and then corrects, capital could flow into memecoins, potentially starting a memecoin cycle by mid-November, as AMBCrypto suggests.
So, should you buy the dip?
As mentioned earlier, most memecoins are seeing significant gains, with 6 of the top 10 gainers over the past 30 days being memecoins.
However, for a full cycle to materialize, it is crucial that enough holders support this theory by treating the current price as a strong buying opportunity.
Source: DansLeBlock
Interestingly, whales, which make up 62% of large DOGE cohorts, have actively collected substantial amounts of DOGE tokens on exchanges over the past month.
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This strategy supports the theory of an upcoming memecoin cycle, as they capitalize on the slowdown in altcoins and the expected increase in volatility once Bitcoin reaches its peak.
Thus, the likelihood of a memecoin cycle emerging after the election seems promising. However, even as these whales capitalize on their gains, their long-term commitment is vital. With altcoins losing momentum, and if history is any guide, memecoins could be primed for a strong rally ahead.
