With the market recovery, open interest in major assets has been rising, but it seems Dogecoin is not following this trend.
Dogecoin (CRYPTO: DOGE) open interest failed to cross the $500 million mark again on Thursday. Here's what it could mean for the meme coin.
Dogecoin Open Interest Fails To Move
Dogecoin open interest failed to surpass the $500 million level once again, data from Coinglass showed. On Thursday, the Dogecoin open interest stood at $493.97 million, a far cry from its all-time highs. This was even as the meme coin's open interest went up by 6.9% over the past 24 hours, with major jumps being seen across crypto exchange OKX and Bitget.
Despite the increase, Dogecoin open interest remained significantly lower than its August highs. At the start of August, the open interest was over $618 million. However, since then, the open interest has largely remained muted, suggesting that crypto traders were shifting their focus elsewhere.
Adding perspective was the fact that the open interest was over 70% lower than its all-time highs last March. On March 29, 2024, Dogecoin open interest had reached a new peak of $2.21 billion. But since then, the open interest has seen a continuous decline. At Thursday's figures of $498 million, DOGE open interest was now down by 77% from March's figures.
Why This Decline Could Be Good For DOGE
Open interest is the total of the open options or futures contracts in the market for a particular digital asset. In essence, it helps investors to gauge whether traders are betting heavily on the recovery or decline of a cryptocurrency or not.
In the case of Dogecoin, the data showed that traders were not as focused on the meme coin as they used to be. However, this is not always a bad thing. Periods of low open interest have often marked market bottoms. The low open interest usually gives investors a good entry into the coin, as the price tends to decline along with the open interest. As the Bitcoin (CRYPTO: BTC) price recovers, Dogecoin price is expected to follow, and when the open interest starts recovering, the DOGE price is expected to rise rapidly with it.
A similar scenario was seen back in January 2024, with open interest marking a bottom of around $300 million. However, over the next few months, the open interest went up by over 630%, sparking an over 100% price surge for Dogecoin.
If the same scenario plays out here, then DOGE price could double once again, putting the price at well over the $0.2 level, especially with a bull run being expected in the last quarter of the year.
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