Dogwifhat [WIF], a memecoin based in Solana, has had a double-digit price drop in the previous 24 hours alone. According to CoinMarketCap's data, it is currently among the top losers on the market for the previously given period because of the same.
As of this writing, the altcoin was worth $2.69, having lost 12% of its value in a single day. The amount of daily trade volume fell by 38% within the same time frame.
WIF traders start to doubt their bullish beliefs
An analysis of WIF's market activities showed that mood has been more pessimistic in recent days. According to Santiment, the memecoin's weighted sentiment was actually -0.546 at the time of publication. The negative value of this statistic indicated that among WIF's market participants, bearish sentiment prevailed over bullish emotion.
WIF's financing rate was negative as well, supporting the negative trend. The token's financing rate on all cryptocurrency exchanges was -0.0009%, per Coinglass data. This is noteworthy because, since February 8th, this is the second occasion that the token's funding rate will be negative.
Perpetual futures contracts use funding rates as a means of guaranteeing that the contract price remains relatively close to the spot price.
When an asset's contract price exceeds its spot price, its funding rate is positive and traders who hold long positions pay a charge to traders who are shorting the asset.
On the other hand, when its contract price is less than the spot price, it returns a negative value and short sellers charge long-position holders a fee.
More traders are holding short positions when there is a negative financing rate on an asset. This indicates that a greater number of traders anticipate a decline in the asset's price than those who purchase it with the hope of selling it for a profit.
Since April 9th, WIF's Futures open interest has been continuously decreasing in addition to the negative funding rate. It was worth $302.45 million at the time of publication, but it has subsequently dropped by 41%.
April 2024, Cryptoniteuae