Dog Memecoins Rebound as Bitcoin Reaches $98,000

Solana-based bonk (BONK) led growth among dog-themed memes Saturday as bitcoin staged a recovery rally to above $98,000, a day after Friday’s bloodbath that pushed it near $93,000.

BONK surged 30%, CoinGecko data shows, with dogecoin (DOGE), shiba inu (SHIB), dogwifhat (WIF) and floki (FLOKI) surging as much as 20%. The dog-themed token category gained 8% on average in the past 24 hours, beating a market-wide jump of 4.5% as tracked by the broad-based CoinDesk 20 (CD20) index.

Memecoins are known for their high volatility and tend to outperform major tokens during price rallies, serving as a leveraged bet on the overall crypto market sentiment.

However, in this case, fundamentals are helping back gains and sentiment among some memecoins. FLOKI was named alongside ether (ETH) and Avalanche’s AVAX as a utility token in a Commodity Futures Trading Commission (CFTC) meeting last month.

The derivatives regulator proposed in a Global Markets Advisory Committee (GMAC) a new class of assets termed utility tokens, which fulfill six criteria that include providing their holder “immediately available, non-incidental consumptive use” in a crypto platform without including “governance and voting abilities.”

“FLOKI was recently highlighted by the CFTC’s Global Markets Advisory Committee as a case study of a utility token, which is a big deal and validates Floki’s utility-first approach,” Floki lead developer B told CoinDesk in a Telegram message. “Floki’s Valhalla metaverse game will go live in early Q1 2024, and the recently released Floki Trading Bot has generated over a million dollars in fees.

“This puts Floki on an entirely different level from other memecoins, especially when the market turns and people start to pay attention to fundamentals again,” B added.

Elsewhere, interest in BONK comes as a host of activities intend to deflate token supply gain traction among users — a move that has historically contributed to higher prices.

BonkDAO, a decentralized group of bonk believers that maintain the token, burned 100 billion tokens from the circulating supply in November and targeted a trillion token burn in December. This could increase the token’s value due to scarcity.

The feat could meet its target in the weeks ahead, observers say.