Once Silicon Valley Bank collapsed on Friday morning due to a bank run and capital problem, Dogecoin (DOGE) fell in value in the cryptocurrency market.
The market cap of top meme tokens dropped over 11% in 24 hours after Silvergate, a crypto-friendly bank, collapsed. DOGE trade volume has increased by approximately 30%, indicating a major market sell-off. DOGE fell 21% in the past week to $0.0640. The dog-themed coin lost 11% of its value in 24 hours, according to Coingecko.
The meme token has dropped 31% in 30 days and 24% in two weeks, with only a 2% growth since 2023. DOGE’s speculative nature and low fundamental value cause macroeconomic uncertainty. Investors and traders drive its value, making it volatile and unpredictable. Silicon Valley Bank’s collapse caused today’s DOGE price drop.
The Federal Reserve’s aggressive rate hike last year contributed to SVB’s slide.
While interest rates were near zero, banks bought low-risk long-term Treasuries. As the Fed raised interest rates to control inflation, these investments lost value, resulting in bank losses.
DOGE’s 24-hour trading volume has returned to $681 million, up 103%, providing lively market activity that can lead to gains under the appropriate conditions. Nonetheless, Shibburn claimed that the burn rate of their favorite meme coin jumped by 36,497.56%, giving the SHIB army reason to cheer.
The crypto’s burn rate may have increased due to the Shibarium Beta layer-2 blockchain’s release.
How this plays out depends on how catastrophic SVB’s fall is and how it affects investor sentiment and Shibarium’s launch excitement.
With Silicon Valley Bank’s bankruptcy and FUD about hidden financial and banking dangers, some market observers foresee further crypto sector suffering. “There might be a slaughter next week as […] short sellers are out there and they are going to hit every single bank, especially the smaller ones,” Whalen Global Advisors chairman Christopher Whalen told Reuters.
SHIB’s market activity is strong, but larger addresses are selling their holdings, reducing whale transactions. Analysts watch Silicon Valley Bank’s next moves to see how they’ll affect Dogecoin’s price.