Trading volumes on cryptocurrency exchanges fell by more than 40% in June, according to data. Some attribute this to Chinese authorities’ regulatory crackdown.
Markets have been fluctuating in recent weeks as a result of this. However, a drop yesterday sparked additional gloomy sentiment, as the Anxiety and Greed Index fell from a rating of 25 to 20 today, indicating a further slide into acute fear.
Tokens for memes The sell-off hit Dogecoin and Shiba Inu the hardest. Is there more to come? That is the question on everyone’s mind.
The crypto volumes portray a depressing story.
In June, spot trade volume decreased 42.7 percent to $2.7 trillion, according to data analytics firm CryptoCompare. Crypto derivatives saw a 40.7 percent reduction in volume to $3.2 trillion during the same time period.
China’s restriction on Bitcoin mining, according to the firm, has resulted in lower prices, lower volatility, and lower trading volume.
“Headwinds remained as China’s ban on bitcoin mining continued. Spot volumes declined as a result of reduced prices and volatility.”
A series of announcements from Chinese authorities have injected substantial FUD into the crypto markets since mid-May. To begin, three industry associations affiliated with the People’s Bank of China issued a warning about crypto trading speculation. Financial institutions must reinforce their “social duties” by refraining from conducting business with virtual currencies, according to the notification.
Local governments quickly followed suit, banning Bitcoin mining companies and, in some cases, turning off the electricity to miners.
As a result, hash rates have dropped and there has been a mining exodus. Several countries have stepped forward to promote themselves as welcoming jurisdictions for Chinese miners. However, it could be months before we see the impact of the move on these measures.
Today, Dogecoin and Shiba Inu both suffered significant losses.
Unfortunately, because Bitcoin is the “God market,” whatever happens there has an impact on the rest of the crypto markets. Bitcoin has been trading sideways for the previous three weeks, with daily closes ranging from $31,600 to $36,000.
Dogecoin started plummeting in price late yesterday evening, falling from $0.2179 to $0.2008 in the early hours of today, a drop of 8%.
Bulls have since stepped up, resulting in a type of comeback. The RSI, on the other hand, is beginning to curl back down to oversold levels, indicating that the bulls are losing speed.
Shiba Inu has a similar story. The price of SHIB dropped at the same time as Dogecoin. In the case of SHIB, however, there have been two distinct dips followed by three bounces at the $0.00000733 support level.
SHIB has lost 7% since the crisis began. The RSI, on the other hand, suggests a more aggressive decline towards oversold levels.
The above indicates that meme tokens are continuing to lose favor with the market. However, until trading volumes recover to pre-FUD levels, if they ever do, this is all speculation.