Dogecoin and Shiba Inu, which experienced meteoric rises as meme coins, are now down 80% and 65% from their peaks in May and October respectively
- Dogecoin, Shiba, other meme inspired tokens are near lows — Advocates wonder if a Shib price of one cent is still feasible
Context & Ripple Effects
The drawdown closes a loop that opened years ago. Dogecoin first crossed $1B in market cap in January 2018 on a 400% monthly run, when its own creator called it a sign of broader market excess — a warning that went unheeded as the coin later hit a $69B valuation and fourth-largest ranking after the #DogeDay rally in April 2021.
Shiba Inu then ran the same playbook at higher speed: a 160% week in late October briefly made it the eighth-biggest cryptocurrency, surpassing Dogecoin itself, while decimalization psychology drew retail buyers who read a sub-penny price as 'cheap.' Both tokens are now down sharply from those peaks, with advocates still debating whether a one-cent Shib remains feasible.
First-order effects
- Retail holders who bought into the decimalization-driven rallies near the May and October tops are sitting on 80% and 65% losses respectively, and the one-cent Shib target that anchored Shiba Inu's bull case now requires an implausible multiple from current levels.
- Dogecoin's slide amid bearish technical patterns removes the momentum bid that had made it the fourth-largest cryptocurrency at its $69B peak.
Second-order effects
- Businesses that accepted Dogecoin for real-world purchases because of its low transaction costs face a payment asset whose purchasing power swings violently, pressuring them to hedge or diversify which tokens they take.
- Attention shifts toward utility-building responses — Shiba Inu's Shibarium Layer 2 launch, pitched on low fees for financial services and gaming — as pure meme momentum can no longer carry valuations.
Third-order effects
- The 2018 pattern — parabolic run, creator warning of excess, collapse — repeating at larger scale suggests meme coins are structurally cyclical assets driven by social momentum rather than adoption curves, with each cycle's peak funding the next experiment.
- If the pattern holds, surviving meme tokens will consolidate around the few that add working infrastructure like Layer 2 networks, separating utility-backed communities from purely sentiment-priced imitators.
The trend: Meme-coin valuations are cycling through repeat boom-bust arcs, pushing their issuers toward utility infrastructure like Layer 2 networks to justify continued existence beyond social-media momentum.