The crypto market is in a massive bloodbath and investors' confidence has continued to weaken. Amid this negative market condition, data from Coinglass shows that the largest meme token by market capitalization, Dogecoin (DOGE), has seen its futures open interest decline by 8.24% over the last day.
The data shows that the total number of active futures contracts involving Dogecoin that have not been settled has dropped significantly to 15.16 billion DOGE worth approximately $3.25 billion.
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This marks a massive decrease from the number of DOGE recorded the previous day, sitting at its bare levels since the beginning of August.
DOGE bull season over?
The plunge in Dogecoin’s open interest comes as the meme coin falls significantly in its trading price, struggling to hold key support levels.
While the price plunge is experienced across the broad crypto market, prices of altcoins and memecoins are mirroring the broader market downturn led by Bitcoin and Ethereum.
With this unfavorable market trend, risk appetite across altcoins and meme assets has declined massively, and such highly volatile cryptocurrencies like Dogecoin have continued to plunge deeper over the past days.
With Dogecoin falling notably by 8.24% in the last day, it appears that traders are increasingly exiting leveraged positions. While the latest liquidation trends have seen traders opening long positions suffer massive losses, the decrease in DOGE’s open interest signals weakening confidence among investors. As such, the unsettled futures contracts have probably been wiped out by liquidation, or the traders are closing positions to hedge against the possibility of suffering further losses.
What’s next for DOGE?
Following speculations that the broad crypto market might already be slowly entering its bearish phase, investors are wary of committing more funds to the asset’s derivatives market.
Over the last day, the token has seen its price decline massively by 4.4%, trading as low as $0.2137 as of press time, according to data provided by CoinMarketCap.
Despite positive predictions from analysts suggesting that the token might regain momentum shortly, investors are still taking caution as sustained decreases in open interest like this have historically been followed by deeper market bloodbaths.
