Doge contributor warns of extreme volatility amid Coinbase listing of DOGE and PEPE futures products

Nguồn Fxstreet
11/04/2024 22:49
  • Doge contributor says BTC halving will make market movements weird, especially with high liquidity flow from new market participants.
  • Dogecoin will see increased exposure to the US market following its futures listing on Coinbase.
  • Meme frenzy could resume as a trader gained more than 69,500% from trading a meme token.

A Dogecoin (DOGE) contributor warned the DOGE community on Thursday to desist from derivatives trading due to the high volatility that may occur as the Bitcoin halving approaches. The warning comes as Coinbase is set to begin trading the Dogecoin futures contract after gaining approval from the Commodity and Futures Trading Commission (CFTC).

Read more: Dogecoin soars nearly 20% after Coinbase announces listing of DOGE derivatives

Dogecoin derivatives could expose traders to high-risk

Dogecoin and several top meme coins have traded sideways for the past week following a general market consolidation. While the Bitcoin halving is bringing hype across several social channels, with traders expecting another meme frenzy, it's yet to reflect in recent price action.

With the expectation of a bull run surrounding the upcoming halving, Dogecoin contributor @Mishaboar warned in an X post on Thursday that "things will get weird (in any direction) while people think they can easily predict the market."

Also read: Dogecoin rises to highest price since 2021 after spike in transaction volume

He cited examples of how the emergence of new market participants, their high liquidity flow, and increasing trading volume have changed market dynamics compared to previous cycles. Leverage and derivatives compound the high-risk crypto trading to a high level, "and many players in that arena look at Doge as one of the ultimate playgrounds," said @Mishaboar.

Coinbase to list DOGE and PEPE derivatives

The warning coincides with Coinbase's blog post on Thursday that it would launch Dogecoin futures on April 29 after gaining approval from the CFTC earlier in March. As a result, more US traders will gain exposure to DOGE derivative products, allowing them to speculate on its price movement.

Barely a few hours after its DOGE futures announcement, Coinbase released another meme coin update, stating it would be adding support for PEPE perpetual futures on Coinbase International Exchange and Coinbase Advanced on April 18. Following the announcement, PEPE's price spiked, gaining nearly 6% in the past 24 hours.

Read more: Pepe price coils up for next leg higher as meme coins awaken

As future products for meme tokens continue entering the market, the fading meme frenzy could pick up again.

Meanwhile, Lookonchain data revealed that a trader recorded more than a 69,500% gain by spending $9,000 worth of ETH to buy the APU meme token. His current holdings are worth $6.27 million.

Meme coin trading carries high risk, as its price is subject to significant volatility, and some tokens may be outright scams. Before investing, it's important for investors to do their critical research and assess their risk appetite.

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