Bitcoin is on the charge in 2023, dragging the cryptocurrency market off the floor and electrifying Bonk, a new meme coin.
The No 1 cryptocurrency has clocked a 26 per cent gain in January, leaping 22 per cent in the past week alone, breaking back above the US$20,000 level and putting in on course for its best month since October 2021 – just before the Big Crypto Crash.
Ether has also risen, by 29 per cent this year, helping drive the value of the overall global cryptocurrency market above US$1 trillion, according to CoinGecko.
“After a rough year last year for cryptos, we are seeing a form of mean reversion,” said Jake Gordon, analyst at Bespoke Investment Group, referring to the theory of asset prices returning to long-term averages.
Researchers said that investor bets on a rosier macroeconomic picture were driving a jump in riskier assets across the board.
Few crypto tokens have benefited more than Bonk, which was launched at the end of December on the Solana blockchain and had rocketed 5,000 per cent by early January. It has since fallen back, though it remains up 910 per cent since the start of the year.
It is the latest entrant to the hyper-volatile world of meme coins, cryptocurrencies inspired by online memes and jokes, and is modelled after the same grinning Shiba Inu dog as Dogecoin – which itself was catapulted to fame by Elon Musk tweets.
Bonk is a puppy, though.
Even at its peak it was worth just US$0.000004873759 with a market capitalisation of about US$205 million.
Other meme tokens are also up, with Dogecoin and Shiba Inu up 19 per cent and 27 per cent respectively in 2023.
But buyers beware.
“Investors need to be especially cautious when it comes to coins like Doge, Shiba Inu and Bonk,” said Les Borsai, co-founder of digital assets services firm Wave Financial.
“They fall just as hard as they surge.”
Nonetheless, some market players pointed to the relative cheapness of these tokens – Doge is worth about US$0.08 – as a reason why speculators were willing to place bets on them.
“Meme coins belong to crypto, it’s part of the culture,” said Martin Leinweber, digital assets product specialist at MarketVector Indexes. “It just takes a few lines of codes to create a meme token and if you have a community for it, people love that.”
Source By https://www.channelnewsasia.com/business/cryptoverse-bitcoin-back-bonk-3210991