Dogecoin and XRP, two of the most
popular altcoins, have been bought over three days in large numbers. Now
residing in the wallets of whale investors, it has been seen as a positive
outcome for the pair. We discuss this in the article below.
In just a few short days, around $2.5
billion in Dogecoin and XRP has been accumulated by crypto whales. Whales are
large-scale investors who buy substantial amounts and hold currencies for a
long period of time. According to one trader on Twitter, the feeding frenzy
began with XRP. This then went on to a two-day period where 470 million
Dogecoin were purchased in a 48-hour period. Whales now hold $158.86 million in
assets at the time of writing.
Dogecoin and XRP Bought by Whale Investors
The same trader then went on to
discuss the price of both assets, predicting they will have a huge rise in
February. However, he also noted that over the last month, inflows have
declined. They had moved from $134 billion to $68 billion. This is a common
trend for the month of January, which typically sees a lull in investment after
the rush of the pre-holiday months.
These accumulations by whales never
occur out of the blue. When whales move to buy large currency stocks, it is
typically a precursor to bigger price movements. This is because they can shape
the market. Accumulation is seen as positive sentiment by them, whereas a large
sell-off is viewed as the opposite. This movement by cryptowhales is believed
to be a good signal, and the above-mentioned social media trader believes that
Dogecoin could go as high as $0.66 at the start of February or just after.
Will Dogecoin’s Breakout Hold?
The truth is that Dogecoin really is
at a pivotal point in its development, regardless of any whale action. The Dogecoin
price has been hanging around a level of $0.33 with little
deviation. In December, it had quickly dropped to $0.27, which spooked many but
also led to a quick reversal. Many social media investors tagged this as a
precursor to a bullish comeback.
This $0.33 level is seen as a crucial
point. Given the right support, if it holds above this level, it could begin a
bull run and recover. The accumulation of the coin by whales does hold some
hope, showing a recovery is probably incoming. However, it will need backing
from other, more fluid investors and a fresh wave of confidence. The worry is
that the breaking of this level then sees a rebound, which has been seen
recently in the Bitcoin price.
Dogecoin and the Bitcoin Halving
There are several other factors that
make Dogecoin a popular cryptocurrency for a bull run in 2025. It is the most
popular of all the memecoins, has endorsements from celebrity billionaires, and has done very well in
other crypto-positive seasons. However, the biggest signal of the
cryptocurrency’s potential lies in how it has done historically during the year
of Bitcoin halving.
A bitcoin halving event is when the
price for mining, and thus producing Bitcoin, is halved. This is an
inflationary measure and reduces the supply. Taking part every four years, it
is important as Bitcoin tends to spike in price both three months and six
months afterwards. That is what happened this year, although the six-month
spike was pushed back a little due to external factors.
Other cryptocurrencies and coins
follow similar patterns when this occurs. In the 2020
event, Bitcoin began to pick up in the weeks that followed, reaching a high of
11k by August. Its real breakout occurred in December, and it had reached 30k
by the start of the new year. Thus, the upturn would continue for some time,
reaching a high at the end of the proceeding annum.
As Bitcoin rose, Dogecoin followed a
very similar trajectory. It picked up after the Bitcoin halving event, then at
the end of the year had a major price rise. By the start of the new year, it
had risen 470% since the start of the event. This continued until the trend
changed and cooled off halfway through the year.
The big question is whether Dogecoin
will repeat the cycle this time. Last year’s event took place in April, and it
is worth noting that some of the spikes in the price of Bitcoin have been
delayed. This will probably be reflected in Dogecoin’s changes, if and when
they happen. However, it has already risen 113% in value since the halving
event. This suggests that if it followed the same leap in value it did after
the 2020 halving, it would see a high of $48 before a decline.
This would lead to a stupendously high
market cap for Dogecoin, which is unlikely. Therefore a more conservative
estimate is probably welcome. Economic factors like rate cuts may impact this. However, with
historical data behind it and the movements of whales, now could be the time to
buy and hold.