Key Points
- Bitcoin’s rebound and memecoins’ slump hint at a potential market cooldown.
- Low-cap tokens could experience short-term surge as investors’ risk appetite increases.
The second week of October saw Bitcoin (BTC) breaking resistance to test the critical $64K level, a robust rebound from the previous week’s dip to $58K.
Meme Coins Wane as Bitcoin Rises
During that period, top memecoins recorded substantial surges, some even posting triple-digit gains as capital flowed out of Bitcoin. However, many of these memecoins are currently trading below their former highs, indicating a potential distribution phase as market focus shifts back to BTC.
As Bitcoin resurges and most high-cap memecoins face a downturn, a pattern suggests that the market may be nearing the end of the memecoin craze rather than the beginning of a “super cycle.” If this trend continues, a broader market cooldown could be on the horizon.
Shift to Low-Cap Tokens
Typically, an increase in BTC price heightens investors’ risk appetite, leading them to explore more speculative assets, including lower-cap memecoins. Despite their higher volatility, these assets are seen as attractive options for quick and substantial returns. Consequently, they may experience a short-term surge in demand.
One notable example is Mother Iggy (MOTHER), a celebrity Solana-based memecoin with a market cap of $85 million. The token has regained traction, surging over 5% in the last 24 hours to $0.83. This marks a significant recovery from last week’s 10% plunge.
In summary, many top memecoins may be poised for a correction, as Bitcoin gears up for its next parabolic ascent. Thus, the next memecoin supercycle could initiate once BTC reaches an exhaustion point around $66K. Meanwhile, the market is seeing major memecoins stagnate while smaller market-cap tokens surge, mirroring the trend after BTC reaches a top when capital shifts into smaller coins as larger players distribute their holdings.
