“Bonk got bonked“
Memes in the crypto-currency market are almost always short-lived, especially in the absence of proper market-making and liquidity provision. Bonk has been widely distributed among holders of some NFT collections, which leads us to an unpleasant conclusion: the latest 56% correction on the meme asset is just the beginning of profit taking.
The price of the asset meme can tumble at any time and there is no buying power that could stop a further decline. However, BONK is still trading well above its listing price. On some crypto-currency exchanges, the meme asset trades at $0.0000019.
The long-term future of BONK is unclear, but investors should put their hope in assets created purely for memes and fun. If not, we will see a situation similar to Shiba Inu, when an asset created for fun and memes turned out to be a disaster for thousands of investors who lost their funds by grabbing the token at point highs.
The return of Ethereum
Despite the problems Ethereum faced in December and November, the network is clearly on the road to recovery as usage and activity on the network have entered an upward trend. Excess issuance has been reduced to 4,200 ETH from the most recent peak of 5,000 ETH.
Fortunately, the overall market recovery in terms of liquidity and volatility has led to increased activity on Ethereum. In addition, the increase in staking contract volume has acted as fuel for the network.
The performance of the ETH price has not changed in the last few days of the new year. Currently, Ether is moving in a symmetrical triangle, which is a signal of an upcoming increase in volatility. Unfortunately, it is not yet clear which direction the second largest crypto-currency will choose, but at least some traction in the market will give us some missing information.
Solana reacts to Bonk
Unfortunately, Solana’s most recent rally was primarily fueled by the aforementioned meme currency, as was its elevated network activity, which was part of the price rally we have seen recently.
As expected, as soon as the only source of liquidity disappeared from the network, Solana already turned downward. For three days, SOL struggled against the 50-day moving average and repeatedly tried to break it. But without the support of retail and institutional investors, no progress was made, even with a powerful engine like BONK.