Shiba Inu, Dogecoin, Solana surge higher: Where are meme coins headed from here?

Is another bull market in meme coins just getting started?

| More on:
Rising rocket with dollar signs.

Image source: Getty Images

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

This article was originally published on All figures quoted in US dollars unless otherwise stated.

What happened

The entire cryptocurrency market is rallying today, with more defensive and higher-beta tokens trading higher almost in lockstep. For meme tokens Shiba Inu (CRYPTO: SHIB) and Dogecoin (CRYPTO: DOGE), 24-hour price increases of 15% and 6.5% as of 12:45 p.m. ET, respectively, reflect increasingly bullish sentiment in the crypto sector. As a gauge for retail investor interest, these tokens are often looked to as directional indicators of where the market may be headed. 

Shiba Inu's surge appears to be related to a recent community vote to reduce mining rewards with the network's upcoming Layer 2 blockchain, Shibarium. Similarly, Dogecoin is seeing interest surge ahead of its Dogecoin Core 1.14.6 release, which is intended to harden node and network security while also incorporating fixes and adjusting rewards on the network.

Solana (CRYPTO: SOL), while not a meme coin in its own right, does have one meme token on its blockchain investors are watching. Solana-based Samoyedcoin is also up approximately 7% over the past 24 hours, at the time of writing, as investors look for high-leverage options to gain exposure to this crypto rally today. 

So what

Amid the fallout from other high-yielding projects, and those offering rewards many now view as unsustainable, the moves Shiba Inu and Dogecoin have made to reduce rewards and focus on network stability certainly make sense.

The saying "if it's too good to be true, it probably is" has taken on a whole new meaning in the crypto world. At the end of the day, rewards come from somewhere, and whether it's inflation from minting new tokens, or Ponzi-like structures that only work when prices go up, crypto investors certainly have reason to worry about projects over-offering rewards.

Now what

Meme tokens remain among the most volatile and high-risk assets investors can consider for their portfolios. While there's certainly more developer activity being seen with the likes of Shiba Inu, Dogecoin, and other projects, the ultimate valuation investors can place on the real-world utility generated from these projects likely remains negligible. Accordingly, aside from bullish investor sentiment, there really aren't many fundamental drivers that can take these tokens higher over the long term.

That might change, but for now, investors may want to view these tokens as ultrasensitive gauges of investor sentiment. In today's session, that means some nice near-term rallies in these tokens. However, if the selling pressure isn't over, investors may want to prepare for more downside risk in the medium term with these dog-inspired tokens. 

This article was originally published on All figures quoted in US dollars unless otherwise stated.

Chris MacDonald has positions in Solana. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has positions in and has recommended Solana. The Motley Fool Australia owns and has recommended Solana. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips. 

More on International Stock News

A man looking at his laptop and thinking.
Share Gainers

Should I buy Nvidia stock as an Australian investor?

Many Aussies are thinking of jumping on the bandwagon, but they need to think about these issues first.

Read more »

Digital rocket on a laptop.
Broker Notes

Is the Nvidia share price on course to reach US$1,400?

You betcha, says one analyst.

Read more »

A woman holds a soldering tool as she sits in front of a computer screen while working on the manufacturing of technology equipment in a laboratory environment.
International Stock News

Could Nvidia become the most valuable stock on earth?

Can anything stop the Nvidia stock price?

Read more »

A group of young ASX investors sitting around a laptop with an older lady standing behind them explaining how investing works.
International Stock News

What can ASX investors learn from Warren Buffett's latest buys and sells?

We've just found out what Buffett's been buying and selling recently.

Read more »

electric vehicle such as Tesla being charged at charging station
International Stock News

Why Tesla stock tanked in January

Will the electric vehicle leader see earnings decline once again in 2024?

Read more »

A woman sits at her computer with her hand to her mouth and a contemplative smile on her face as she reads about the performance of Allkem shares on her computer
International Stock News

Will Nvidia stock be worth more than Microsoft by 2030?

The graphics giant has been growing at a much faster pace than Microsoft, but can it sustain that momentum?

Read more »

Man with hands in the middle of two items with money bags on them.
International Stock News

Stock-split watch: Is Tesla next?

Stock splits are fun. But how much substance there is in Tesla splitting its stock is debatable.

Read more »

A male investor sits at his desk looking at his laptop screen holding his hand to his chin pondering whether to buy Macquarie shares
International Stock News

Yes, Microsoft is a star AI stock, but this is what really powered its solid second-quarter results

Deep involvement with artificial intelligence (AI) has made the company popular with investors, but that isn't (yet) the top motor…

Read more »