Telegram’s DOGS Plunges 30% After Airdrop — A Binance Launchpool Curse?

The price of Telegram-linked DOGS (DOGS) has plunged 30% following its $550 million airdrop, suggesting that beneficiaries are liquidating the memecoin to secure early profits.

Could DOGS Price Gain Ahead?

As of Aug. 30, DOGS was trading for as low as $0.00128 on Binance, compared to its opening day peak of $0.00180 four days ago. Still, when measured from the lowest level of its debut, the memecoin was up by over 135%.

Technically, DOGS has been trading inside a horizontal range, defined by $0.00160 as resistance and $0.00119 as support. If recent history is any indication, the TON Blockchain-based memecoin will likely rebound toward the $0.00160 resistance target in September, up by circa 25% from the current price levels.

DOGS’s ongoing price consolidation further indicates that some airdrop beneficiaries have been choosing to hold the memecoin than selling it, indicating their interim bullish bias toward it. That could be due to an overall optimistic sentiment in the crypto market, especially due to the Federal Reserve’s increasing rate cut odds at the end of their meeting on Sept. 19.

Memecoins, the riskiest cryptocurrencies, often experience higher market volatility during key phases or ahead of major events.

For instance, rate cut anticipations have led to an overall upside sentiment in the crypto market in 2024. Still, some of the biggest gainers year-to-date are memecoins like Popcat (POPCAT), Dogwifhat (WIF), and Pepe (PEPE), as shown below.

Beware of Binance Launchpool Curse, Though

The ongoing consolidation phase in the DOGS market may result in a correction owing to a fractal analysis concerning Binance Launchpool.

Data reveals an interesting pattern about the cryptocurrencies listed for farming at Binance Launchpool. Most of these tokens have suffered major price declines after going live on the platform. For instance, layer-1 blockchain asset Sui (SUI) dropped by circa 35% after its Binance Launchpool inclusion in March 2024, as shown below.

Similarly, name service Space ID’s native token ID dropped by 80%.

Social media token Cyber (CYBER), listed on Binance Launchpool in August 2023, experienced a short-term price boom, only to crash 75% afterward.

As it seems, early investors who farm or acquire tokens at a lower cost through Binance Launchpool sell their holdings once the token is listed on the exchange, leading to increased selling pressure.

Furthermore, launchpool projects often distribute significant tokens to participants who stake other cryptocurrencies like BNB or stablecoins. When these tokens are released into the market, the sudden increase in supply can overwhelm demand, leading to price drops.

As a result, it becomes vital to ensure that DOGS is holding above its current support level of $0.00119. Any decisive breakdown below the line could result in further declines.