Dog-themed cryptocurrencies jumped on Monday as broader retail-investor enthusiasm hit the market, particularly as Ethereum works towards its much-anticipated software upgrade.
Dogecoin is up about 14 per cent over the past five days, while Shiba Inu has gained almost 40 per cent, according to pricing data compiled by Bloomberg. The meme tokens are holding their gains even as Bitcoin hovers around $25,000 and Ether is at about $2,000 amid optimism surrounding its upgrade, known as merge, now expected about September 15.
“Dogecoin and Shiba Inu have both broken out over the weekend, clear evidence that the retail investor is back,” said Hayden Hughes, chief executive of social-trading platform Alpha Impact.
There is optimism that both coins will gain as Ethereum did because both are due for upgrades as well, he said.
The crypto market has shown some signs of recovery with its total market cap now at about $1.2 trillion, after having dropped to about $875 billion as of June 19, according to data from CoinGecko.
Lower-than-expected inflation prints out of the US last week boosted hopes that the Federal Reserve might be able to ease off its pace of rate increases, helping riskier assets like crypto.
Ethereum has also been supported after a final test stage before the merge upgrade, which co-founder Vitalik Buterin estimates will occur by about the middle of next month.
Still, not everyone is all-in on the memecoin trend just yet.
“These coins don’t have the depth of market at times like Ether or Bitcoin, so when a bit of demand comes through, they hit a liquidity pocket and fly up, drawing in more speculators,” said Cici Lu, chief executive officer at consulting company Venn Link Partners.
Alpha Impact’s Mr Hughes also sounded a note of caution about the rally.
