Floki token retreated sharply on Friday, Aug. 30, making it the worst-performing meme coin in the industry.
Floki (FLOKI), the sixth-biggest meme coin, fell by over 20%, reaching a low of $0.00012, its lowest point since Aug. 21. It has dropped by over 23% from its highest point this week and by 64% from its highest point this year.
Other meme coins like Bonk (BONK), Popcat (POPCAT), and Mog Coin (MOG) were down by over 10% on Aug. 21.
The main catalyst for Floki’s sell-off was the movement of 15.2 billion tokens worth $2.27 million by a dormant account to Binance. Such moves to exchanges are typically followed by heavy selling activity, which can trigger stop losses from other holders who will join the selling frenzy.
A wallet linked to @RealFlokiInu returned after 2.5 years of dormancy and deposited 15.22B $FLOKI ($2.27M) to #Binance 9 hours ago, just before the price plunged.
Data by Spotonchain shows that more big holders continued moving their Floki tokens out. Another big holder transferred tokens worth $629,000 to MEXC on Friday.
More data shows that the net outflows of Floki from both centralized and decentralized exchanges continued this week. Net outflows from CEX exchanges fell to their lowest point since Aug. 21, while those from DEXes rose to the highest level in over a week.
Floki’s price action also coincided with the weakness in the crypto industry as Bitcoin (BTC) remained below $60,000. The total market cap of all coins has also dropped from over $2.3 trillion early this week to $2.09 trillion.
Launched in 2021, Floki has become one of the biggest players in the meme coin industry, with a market cap of over $1.27 billion. This growth happened as the developers worked to transition it from a mere meme coin to an active ecosystem.
They launched TokenFi, a platform for tokenizing real world assets, Floki Locker, a DeFi network with over $31 million in assets, and Valhala, a play-to-earn NFT metaverse. In an X post, the developers noted that Valhalla would enter the next phase ofgrowth, backed by its $30 million treasury.
Floki maintains some weak technicals as the token formed a death cross pattern on Aug. 27 when the 200-day and 50-day moving averages crossed each other. The Percentage Price Oscillator, a unique form of the MACD, remains below the neutral point.
Therefore, Floki may continue falling as sellers target the next point at $0.0000954, its lowest point in August and 25% below Friday’s level.
Bitcoin price held steady above $60,000 on Thursday, Aug. 29, even as its exchange-traded funds saw two consecutive days of outflows.
Data from SoSoValue shows that Bitcoin (BTC) ETFs lost $105.19 million in assets on Wednesday after shedding $127 million the previous day. These funds have accumulated $17.85 billion in assets, with most of the money coming from institutional investors.
Another potential catalyst is that the amount of coins held in exchanges has dropped to the lowest point this year. According to CoinGlass, exchanges held 2.38 million coins on Aug. 29, down from 2.4 million in Aug. 27 and last month’s high of 2.50 million.
Falling Bitcoin reserves often indicate low liquidity in the market and suggest that most investors are no longer moving their coins from wallets to exchanges, a key step in liquidation. For example, Bitcoin reserves surged in July when the German government liquidated its reserves.
The falling US dollar and growing US public debt are other potential catalysts for Bitcoin. The US dollar index, which measures the price of the greenback against a basket of currencies like the euro, pound, and Swiss franc, fell to $101.50, down over 4.7% from its highest level this year. The US dollar has pulled back after Federal Reserve chief Jerome Powell hinted at possible rate cuts in the September meeting.
The US dollar has pulled back after the Federal Reserve chair hinted that the bank will start cutting rates in its September meeting.
Additionally, the US public debt has continued rising and is moving to unsustainable levels, making Bitcoin a viable alternative. Data by US Debt Clock shows that the national debt jumped to over $35.2 trillion, or 123.2% of the GDP. Annual interest on this debt has jumped to over $920 billion.
The same trend is occurring globally, with liquidity reaching a record high of $95 trillion. As a result, more institutions and retail investors may turn to alternatives, first to gold, and then to Bitcoin.
Meanwhile, the options market is pointing to a potential Bitcoin rebound, potentially to $90,000 later this year. Additionally, Bitcoin funding rate has dropped to -0.0011%, pointing to more upside.
Solana price has remained in a deep bear market, falling by over 30% from its highest point in 2024.
Solana (SOL), the fifth-largest cryptocurrency in the industry, was trading at $145, down from its year-to-date high of $210. Its valuation has retreated from a YTD high of $86 billion to $68 billion.
SOL is in a bear market because of its correlation with Bitcoin (BTC) and other altcoins. Bitcoin has dropped by almost 20% from the YTD high while coins like Ethereum (ETH), Avalanche (AVAX), and Cardano (ADA) are down by over 30%.
Altcoins like Solana typically make bigger moves than Bitcoin. They perform better when Bitcoin is rising and significantly underperform when it is in a downtrend. For example, BTC rose by 70% between Jan. 1 and March 24, while SOL and ETH rose by over 80% during the same period.
Solana has also retreated as it faces substantial competition from Tron (TRX), which recently launched SunPump, a meme coin generator. The DEX volume on Solana in the past seven days has fallen by almost 9% while Tron’s has risen by over 210% to $1.70 billion.
Most of Solana’s meme coins have also retreated. Dogwifhat has dropped by almost 70% from its highest level this year, while Book of Meme (BOME) has fallen by 80% from its all-time high.
Tron has also overtaken Solana in DeFi total value locked, the number of active addresses, and stablecoins. Tron has over $8.3 billion in assets, 2.47 million in addresses, and almost $60 billion in stablecoins. In comparison, Solana has $5.16 billion, 1.74 million, and $3.9 billion, respectively.
Solana’s futures open interest has fallen
Meanwhile, Solana’s open interest in the futures market has been in a downtrend. Most recently, the interest peaked at $3 billion in July and has pulled back to $2 billion, signaling waning demand.
Solana has also dropped because of the ongoing performance of spot Ethereum ETFs. The latest data shows that they have not become popular. They have had cumulative outflows of $481 million and have shed assets in five of the last six weeks.
Therefore, if the trend continues, there is a likelihood that companies like Blackrock, Fidelity, and Franklin Templeton will not apply for a spot Solana ETF. The SEC has also been reluctant to approve these funds. Earlier this month, the agency turned down Cboe Global Markets’ 19b-4 filing for a Solana fund.
Technically, as shown above, the pullback is likely part of the formation of a bullish flag pattern. It is also part of the hand section of the cup and handle pattern on the weekly chart. If these patterns work out well, Solana will likely bounce back later this year.
What caused Bitcoin and Ethereum to plunge into a liquidation spiral? With traders losing millions, how did market conditions shift so quickly, and what’s next?
Table of Contents
The crypto market is playing a game of hide and seek, with Bitcoin (BTC) and Ethereum (ETH) leading the charge as they hover around key price levels.
The entire crypto market has been in a state of distress, losing approximately 15% of its value between Jul. 29 and Aug. 28. The market cap has declined from $2.48 trillion to $2.11 trillion, reflecting the widespread bearish sentiment.
As of Aug. 28, Bitcoin has taken a fresh tumble, dropping over 4% in the last 24 hours to trade at $60,000 levels. This decline followed a near dip to $58,000 before a slight recovery.
Just a month ago, on Jul. 27, BTC was comfortably sitting at $69,400, marking a sharp decline of about 14%.
BTC 6-month price chart | Source: TradingView
On Aug. 27, spot BTC ETFs experienced heavy outflows, with around $127 million pulled out, marking the first day of outflows after eight consecutive days of inflows. This shift could be a key factor behind the sharp correction we’re witnessing.
Meanwhile, ETH has mirrored BTC’ moves, with its price dipping nearly 4% to its current level of $2,500. However, ETH’ journey over the past month has been even rockier, experiencing a 22% drop in just 30 days.
ETH 6-month price chart | Source: TradingView
The challenges for ETH have been intensified by spot ETH ETFs, which saw cumulative outflows of over $115 million between Aug. 15 and Aug. 27, with no signs of positive inflows.
Massive liquidations rock the crypto market
The recent sharp downturn in the crypto market can be traced to several interconnected events, creating a perfect storm for the sell-off we’re witnessing.
In the last 24 hours as of Aug.28, nearly $320 million in crypto positions have been liquidated, according to Coinglass data.
A vast majority of these liquidations hit long traders, who faced losses of $261 million, dwarfing the $58 million in short liquidations, indicating that many traders were betting on the market going up, but the market had other plans.
Bitcoin led the charge in these liquidations, with over $101 million wiped out. Of this, $82 million came from long positions, meaning traders who were confident Bitcoin would continue rising were caught off guard.
Ethereum wasn’t far behind, with nearly $96 million in liquidations, again with most coming from long positions. But why did the market take such a turn?
Just a few days ago, on Aug. 25, Bitcoin’ funding rate on the DyDx exchange hit its highest level since BTC’ all-time high in March, according to Santiment.
📊 Crypto’s latest retrace is coming after longs were pouring in on exchanges like @dYdX at the highest rate since Bitcoin’s All-Time High craze in March. Greed suddenly came pouring in on August 25th, and liquidations happened swiftly. When funding rates get extreme in either… pic.twitter.com/siXhAI46VQ
Funding rates are essentially payments exchanged between buyers and sellers of perpetual contracts to keep their positions open. When these rates spike, it often signals that traders are heavily favoring one side of the market, in this case, going long on Bitcoin.
This overconfidence in long positions was partly fueled by Federal Reserve Chair Jerome Powell’ recent comments, where he hinted at a possible interest rate cut in September.
Many traders took this as a sign to load up on Bitcoin and Ethereum, expecting the market to rally. However, when funding rates get too high in one direction, they can become a ticking time bomb.
Santiment analysts noted that extreme funding rates often lead to liquidations, driving the market in the opposite direction, which is exactly what happened here.
Adding fuel to the fire, news broke on Tuesday that a federal grand jury had returned a revised indictment against former President Donald Trump.
Trump, who has positioned himself as a pro-crypto candidate for the upcoming U.S. presidential election, could influence the market’ sentiment.
CNBC reported that the uncertainty around this political event likely caused traders to go “risk-off,” meaning they sold off their crypto holdings to move into safer assets like cash.
What’s next for the crypto market?
Despite the recent dip, some analysts believe that Bitcoin is still holding strong above crucial support levels.
Michaël van de Poppe, a respected crypto analyst, highlights that Bitcoin remains above a key level at $61,000. According to him, maintaining this level could pave the way for a new all-time high.
He notes that with the current momentum, especially with the excitement around Bitcoin ETFs, there’s a strong possibility that BTC could push higher if it holds this support.
Meanwhile, Ali Martinez, a technical and on-chain analyst, observed that a significant number of top traders on Binance are going long on Bitcoin. In fact, nearly 65.22% of them are buying the dip, betting on a rebound.
CryptoCon, a Bitcoin technical analyst, believes that the recent low volatility phase is nothing new and is part of Bitcoin’s typical mid-cycle behavior. He notes that this phase mirrors similar periods in previous cycles, such as those in 2021, 2017, and 2013.
According to him, those who are prematurely calling the top may soon find themselves left behind as the market resumes its upward trend.
However, not all analysts are entirely bullish. Emperor, another respected figure in the crypto space, offers a more cautious perspective. He has advised traders to be careful, particularly with Bitcoin’s failure to sustain above key monthly and quarterly levels.
Bitcoin Price Update
Everything is numerically marked on the Chart.
We expected a Dump but I did not expect the dump to be this hard and fast, within the first day. But this is why you manage risk.
Emperor suggests that the best strategy right now is to take quick trades rather than hold onto positions for too long.
He views the recent price action as a temporary setback rather than the start of a bearish trend but emphasizes the importance of managing risk and waiting for the price to react before making any large moves.
Caution ahead
For the crypto market to stage a meaningful rebound, BTC must first hold firmly above the critical $60,000 level. This support zone is essential for maintaining market confidence.
From there, the next challenge is to break through the $65,000 resistance, a level that has previously acted as a barrier.
If Bitcoin can clear this hurdle, it could pave the way for a broader market recovery, with ETH likely to follow suit. Once ETH stabilizes and gains upward momentum, other altcoins could also see a resurgence.
However, the U.S. presidential election race is heating up, and the candidates’ policies on crypto could largely impact market sentiment.
Additionally, all eyes are on the Federal Reserve’ next move, with a possible interest rate cut in September that could either bolster or dampen market recovery efforts.
While the potential for Bitcoin to reach new heights exists, it’s important to always manage your risk carefully and avoid making impulsive decisions.
The crypto market is notoriously volatile, so staying informed and only investing what you can afford to lose is the best approach.
Bitcoin’s fall below the $60,000 mark has triggered a market-wide downturn but its funding rate hints at an incoming price surge.
Bitcoin (BTC) slipped 6% in the past 24 hours and is trading at $59,200 at the time of writing. Its daily trading volume saw a 46% surge, reaching $41 billion. Notably, the BTC price touched a local bottom of $58,100 as fear dominated the crypto market.
CryptoQuant analyst Julio Moreno shared in an X post that Bitcoin saw increased exchange inflows on Aug. 27, before the selloff. Large BTC holders also took part in the inflows as the cryptocurrency market and the leading asset showed signs of being overbought.
Why monitor exchange flows?
There were increasing #Bitcoin inflows to spot exchanges just before today’s sell-off (first chart).
Data from crypto.news shows that the Bitcoin Relative Strength Index rose to 75 on Aug. 24 and has been consistently declining over the past four days — currently sitting at 25. The indicator shows that Bitcoin is currently oversold at this price point.
According to data provided by Coinglass, Bitcoin’s funding rate plunged to negative 0.004% after the massive selloff. The sudden shift in the funding rate shows that the amount of trades betting on BTC’s price fall has increased after the asset saw $96.5 million in liquidations over the past 24 hours.
Historically, a sudden shift in an asset’s funding rate usually sends the price in the opposite direction. In this case, Bitcoin’s price could see a short-term rebound.
In total, the crypto market witnessed over $320 million in liquidations over the past day — $285 million longs and $35 shorts have been wiped out.
The global cryptocurrency market cap also declined by 7% and is currently sitting at $2.17 trillion with a 24-hour trading volume of $108 billion, per data from CoinGecko.
However, it’s important to look out for major macroeconomic events and political movements that could potentially influence the financial markets.
Ethereum price will likely drop to $2,000 first before jumping to $4,000, according to Polymarket, the popular prediction platform.
Odds of Ethereum (ETH) falling to $2,000 before Dec. 31 have been rising since Aug. 25, when they bottomed at 54%. These odds increased to 60% on Aug. 27 as the coin dropped to $2,600 from this week’s high of $2,818.
Ethereum, like most altcoins, has been in a strong downward trend since March, when it peaked at $4,085. Therefore, the odds of falling to $2,000 have risen since the coin needs to drop by 23%. It would need to rise by 54% to reach $4,000.
Another Polymarket poll with $231,000 in assets shows an 8% chance of Ether rising to $3,000 before September. Most traders in another poll with $1.1 million don’t expect it to hit a record high this year.
Ethereum has faced numerous challenges this year. It is experiencing substantial competition in the stablecoin market, where Tron (TRX) is handling billions of dollars in transactions each day.
It is also facing competition in the Decentralized Finance industry, where Solana (SOL) had the most DEX volume in July as demand for its meme coins rose. Solana’s DEX volume was $57 billion in July, while Ethereum handled $54.5 billion.
This month, however, Ethereum is leading by far, having handled $50 billion compared to Solana’s $33 billion.
The biggest challenge that Ether is facing is that its exchange-traded funds are not having traction among investors. Data by SoSoValue shows that these funds have had a cumulative outflow of $477 million since their inception. They have had outflows in the past eight consecutive days.
Additionally, Ether has formed a series of lower highs and lower lows. Most importantly, it has also formed a death cross as the 200-day and 50-day Exponential Moving Averages have crossed each other.
It has also formed a bearish flag chart pattern, pointing to more downside. If this happens, the next point to watch will be this month’s low at $2,113. A break below that point will raise the chances of the coin falling to $2,000.
Sui token has suffered a harsh reversal, falling for three consecutive days, and erasing most of the gains made last week.
Sui (SUI) retreated to $0.90 on Tuesday, Aug. 27, down by 20% from its highest point last week, pushing its market value to $2.3 billion.
Its retreat happened as Bitcoin (BTC) lost momentum and dropped to $62,000. Other assets that rallied after Jerome Powell’s dovish tone have also pulled back, with the Nasdaq 100, S&P 500, and Russell 2000 indices falling by over 30 basis points on Monday.
Sui, like most tokens in the Binance launchpool, has not lived up to its hype as it has crashed by almost 60% from its highest point this year.
Still, its supporters believe that it will overtake Solana (SOL) in key metrics like market capitalization, Decentralized Finance total value locked, and general developer activity.
They argue that Sui’s blockchain is significantly faster than Solana’s and has much lower transaction costs.
Most notably, they claim that Sui is a better alternative because Solana has become highly congested due to its popularity among DeFi, meme coins, and Decentralized Public Infrastructure developers. The case for using Sui for DePIN developers was recently made by Tim Kravchunovsky, the creator of Chirp, a DePIN for telecoms.
Sui has a long way to go to catch Solana, the fifth-biggest cryptocurrency with a market cap of over $71 billion. Data from DeFi Llama shows that Solana has over $5.7 billion in DeFi assets and almost $4 billion in stablecoins. Solana is also the second-biggest chain in terms of DEX volume after Ethereum (ETH).
Sui, on the other hand, has $652 million in DeFi assets and just 38 dApps. It also has $373 million in stablecoins, much lower than what Solana has. Additionally, Sui’s DEX volume in the last seven days was $222 million, while Solana had $5.96 billion.
To be fair, Sui is still in its growth phase as it was launched in 2023, while Solana has been around since 2020.
Another concern about Sui is that it has more token unlocks to go. Data shows that Sui has a maximum supply limit of 10 billion $SUI tokens, of which 25%—or 2.6 million—have been unlocked. Meanwhile, 80% of all SOL tokens have been unlocked, meaning lower future dilution.
Presenting FIXED SUPPLY WITH TRULY DEFLATIONARY PRIMITIVES BUILT IN
As im sure we already know $SUI has a max supply of 10B tokens. That supply is fixed there will never be anymore than that in existence but what’s not common… pic.twitter.com/iqje6wk7JS
Meanwhile, Sui token has pulled back recently after forming a double-top chart pattern at $1.056, with the neckline at $0.8051. In most cases, a double-top leads to a strong bearish breakout.
On the positive side, Sui token remains above the 50-day moving average and has formed an inverse head and shoulders pattern. The ongoing retreat also happened after it retested the 23.6% retracement point.
Therefore, technically, a bullish breakout cannot be ruled out. This view will be confirmed if the price moves above the double-top point at $1.056.
Bitcoin price has retreated for two consecutive days as last week’s momentum in the crypto and stock market faded.
Bitcoin (BTC) retreated from Sunday, Aug. 26 high of $64,960 to $62,300. Still, there are four main reasons why the coin may stage a comeback and retest the important resistance point at $68,000.
Futures open interest is rising
Third-party data shows that demand for Bitcoin in the futures market is making a strong comeback. Data from SoSoValue suggest that interest jumped to $34.7 billion on Aug. 26, its highest point since Aug. 2 and much higher than this month’s low of $26.65 billion. It has also risen for three consecutive days.
Futures open interest is an important figure that shows the number of contracts that have not been settled. A high figure is a sign that there are more participants in the market, which indicates more demand among market participants.
More signs of Bitcoin demand are in the exchange-traded funds market. Data shows that most ETFs recorded inflows on Monday, Aug. 26, for the eighth consecutive day. Total inflows rose to over $202 million, an increase from Friday’s $252 million.
These funds added $506 million last week after gaining $32 million a week earlier, and this trend may continue. Altogether, spot Bitcoin ETFs have had over $18 billion in inflows, with the iShares Bitcoin Trust being the most active.
The most recent filings by hedge funds showed that firms like Millennium Management, Citadel, Schonfeld, and Susquehanna had invested in Bitcoin ETFs. Wall Street banks like Goldman Sachs and Morgan Stanley had also invested in these ETFs.
Bitcoin addresses are rising
Meanwhile, on-chain data shows that the number of active Bitcoin addresses is rising. According to SoSoValue, active Bitcoin addresses rose to 671,000 on Aug. 6, up from 538,000 on Sunday. The number is nearing the month-to-date high of 725,000.
More data shows that new addresses in Bitcoin’s network are rising. New addresses rose to 264,000 on Monday, up from 253,000 a day earlier. These numbers mean that there is still demand for Bitcoin in the crypto community.
Additionally, Bitcoin may benefit from interest rate cuts as it has done in the past. In a statement on Friday, Jerome Powell noted that the bank would likely start cutting rates in September.
The size of the cut will depend on the upcoming personal consumption expenditure and non-farm payroll data. A weak jobs report will raise the odds of a jumbo 0.50% cut.
Bitcoin does well when the Fed is cutting rates, as it did in 2020 when the Fed intervened because of the COVID-19 pandemic. It also rose in 2017 as the Fed slashed rates and then reversed in 2018 and 2022 when it hiked. It raised rates four times in 2028 and six in 2022 as inflation rose.
Additionally, $68,000 is an important level since it is along the series of lower highs that Bitcoin has been forming since March. The first one was at $73,800, followed by $72,000 in June, and $70,000 in July. A break above $68,000 will likely be a sign of a bullish breakout.
The Resistance Dog token, a Ton-based asset, has seen a remarkable surge on the back of increased social media interest following the arrest of Telegram founder Pavel Durov.
On Aug. 25, Resistance Dog (REDO) experienced a sharp breakout from a symmetrical triangle pattern, with its price skyrocketing over 100% in a single day.
This surge was triggered by an outpouring of support from the crypto community, particularly after the Ton X account changed its display picture to REDO’s logo to show solidarity with Durov. CoinGecko also changed the Ton icon to REDO’s logo.
Interestingly, many crypto community members followed suit, triggering a rise in REDO’s social dominance. The gesture symbolized a stand against censorship, which REDO embodies, and resonated with the community that views Durov’s arrest by French authorities as an act of suppression.
Technically, the chart shows that the REDO crypto token price broke out from a narrowing symmetrical triangle formation — a bullish continuation pattern — indicating strong upward momentum.
The breakout was followed by a swift rise in price, reaching as high as $0.9 on Monday, before retracing slightly. The three-day rally, which has triggered a 159% increase, shows significant volatility and heightened trading interest.
However, the recent pullback shows a retest of the triangle’s upper boundary, which could serve as a support level. If the price holds above this support, further gains could be on the horizon, with potential targets at the recent highs near $0.9 and beyond.
REDO’s uptrend contrasts TON’s collapse in response to Durov’s arrest. The REDO Keltner Channel, which envelopes the price based on volatility, shows that REDO’s price has broken above the upper band, suggesting an overbought condition.
Also, the Commodity Channel Index is currently at 174.98, confirming the overbought condition. This could imply a short-term consolidation or a slight correction before resuming its upward trend.
Notably, REDO may face a temporary cooldown, giving the market time to digest the recent gains. At the reporting time, the REDO token has gained by another 3% this morning, currently changing hands at $0.6360.
REDO’s market cap is hovering over the $65 million mark at the reporting time.
