'The Hat Is Covering The Eyes Of WIF Holders': Veteran Trader Doubles Down On Meme Coin Bear Thesis

Popular crypto trader DonAlt has voiced his bearish outlook on Dogwifhat WIF/USD and the broader meme coin market in a series of tweets, expressing concerns over market saturation and the current state of Bitcoin BTC/USD.

What Happened: DonAlt humorously begins by addressing the recent volatility surrounding WIF. "Pretty sure the hat is covering the eyes of WIF holders and they’re accidentally pressing the wrong buttons trying to liquidate me," he quips. He warns, "Once that’s fixed and they can see again I’m getting ready to get rekt," indicating his readiness for a potential downturn.

He outlines several reasons for his bearish stance on meme coins, starting with the sheer volume of memes. "There are infinite memes already," DonAlt points out, highlighting the oversaturation in the market. This influx dilutes the value and potency of individual meme coins, making it difficult for any single meme to stand out and maintain long-term value.

He further underscores that the technical outlook for meme coins is discouraging. "Charts don’t look so good across the board," DonAlt observes, indicating that the broader memecoin market is underperforming. Coupled with heavily skewed bullish sentiment, he cautions that the market might be setting up for a reversal.

Also Read: Star Trader Points Out Four Key Factors Of Successful Meme Coins: Dogecoin, Dogwifhat, Michi Are ‘Relatable Memes’

Why It Matters: DonAlt critiques the current Bitcoin price levels, asserting that the influx of speculators has exacerbated the problem. He thinks that at current Bitcoin price levels, almost all people "willing to buy objectively bad meme coins" have entered the market.

The trader also notes the prevailing market sentiment that links the GameStop rally to the meme coin sector. "Bunch of people bought into the GME -> Meme rotation narrative," he states but dismisses the idea as a misguided analogy. This narrative has driven many investors to expect similar explosive growth, which DonAlt sees as unrealistic given current market conditions.

In his conclusion, DonAlt highlights the need for either a significant rally in Bitcoin or a massive liquidity injection to rejuvenate the market. "You’d either need BTC to giga print to attract outsiders in or a massive liquidity injection," he suggests.

What’s Next: The influence of Bitcoin as an institutional asset class is expected to be thoroughly explored at Benzinga’s upcoming Future of Digital Assets event on Nov. 19.

Read Next: This Trader Sees A ‘Barbell Portfolio Of BTC And Memes’ As Most Profitable Trading Strategy

This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors.

Image created using artificial intelligence with Midjourney.