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The price of Solana-based meme coin Bonk (BONK) slid 10% over the past 24 hours, ending the bullishness that began last week.
BONK is now down 64% from its December all-time high as interest begins to wane among retail investors.
As BONK struggles, some traders are moving funds into the newly-launched Sponge V2 (SPONGEV2) token on Polygon, betting it could be the next meme coin to explode.
BONK Price Rally Crashes Down as Selloff Intensifies
Beginning last Wednesday, BONK experienced a remarkable price rally that led to the token hitting $0.0000141 for the first time since January 17.
However, this rally has now ended, with BONK’s value dropping to $0.000123 in the past day.
The token’s price is fast approaching the 50-day exponential moving average (EMA) on the 4-hour chart, which often acts as dynamic support or resistance.
If BONK were to fall below this EMA, it could result in an even sharper selloff.
More worrying for investors is that the spot trading volume for BONK is down a whopping 44% since yesterday.
This enormous drop could mean investors are losing confidence in the token and looking to exit their positions.
Situations like this aren’t uncommon for BONK, given its status as a meme coin with no real utility.
Thus, even though the token’s value is falling aggressively, it could just as quickly reverse and resume the rally that began last week.
Broader Decline Hits Meme Coin & Altcoin Sectors
While the price action for BONK is undoubtedly concerning for holders, the token isn’t alone in its decline.
Nearly all major meme coins have dropped over the past 24 hours, including Dogecoin (DOGE), Shiba Inu (SHIB), and Pepe (PEPE).
This selloff suggests there could be a broader issue plaguing the meme coin sector.
However, top altcoins like Ethereum (ETH) and Solana (SOL) have also slid since yesterday.
When major cryptos decline in tandem like this, it generally signals deteriorating sentiment and investors pulling funds from the cryptocurrency market altogether.
There doesn’t appear to be a clear fundamental catalyst for this behavior, with a degree of profit-taking likely to be playing a role.
Regardless, time will tell whether BONK and the crypto market’s pullback is simply a blip or a sign of a more extended downtrend.
Sponge V2 Defies Bearishness & Posts 84% Gains After Polygon Migration
However, while BONK and other meme coins struggle, Polygon-based token Sponge V2 appears to be weathering the storm.
Launched as the successor to the popular Sponge (SPONGE) meme token, Sponge V2 aims to build on the original’s success by expanding functionality and migrating to a new chain.
Sponge V2 will introduce new features like play-to-earn (P2E) gaming and staking to eventually overtake the V1 version’s size.
Holders of Sponge V1 can stake their tokens and earn SPONGEV2 as a reward – with yields on Polygon currently sitting at 1,519% per year.
Despite having an anonymous team, Sponge V2 continues to benefit from an enormous online community, including 32,000 people on Twitter.
There is even speculation that crypto celebrity Justin Sun has invested in the project, given that he previously invested in the original SPONGE token.
From a price perspective, SPONGEV2 has performed exceptionally well since migrating to Polygon, up 84% in the past week.
According to DEXTools.io, there are now over 50,000 token holders, with SPONGEV2 boasting a total market cap of $41 million.
Some prominent traders anticipate even more growth for SPONGEV2, with YouTuber Jacob Bury declaring it’s the “best meme coin to buy now.”
With plans for further exchange listings soon, SPONGEV2 could be an under-the-radar meme coin worth watching for speculative investors.
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