The meme coin sector rose by 12% on Tuesday, with certain coins like pepe (PEPE) and dogwifhat {{WIF}} surging by 22% and 25% respectively, while the CoinDesk 20 Index saw a 2.3% increase.
Meme coins tend to perform well when Bitcoin, Ethereum, and Solana are trading near local highs; however, they are also sensitive to changes in liquidity, leading to extreme peaks and drops compared to major cryptocurrencies.
After a shooting incident involving Donald Trump, meme coins based on American politics like America Coin (USA) and Super Trump (STRUMP) saw significant increases of 204% and 43%.
During periods when Bitcoin and Ethereum are stable near highs, meme coins like Dogwifhat can rise significantly, as observed with a 60% increase in May; but when the market falls, meme coins can experience rapid devaluation, such as WIF losing 60% amidst a 21% BTC drop.
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