Meme Coin Liquidity Hits Record High Even as Bid-Ask Spread Spotlights Risk

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Omkar Godbole is a Co-Managing Editor on CoinDesk's Markets team.

Nevertheless, bid-ask spreads remain elevated, a sign the tokens are still considered relatively risky.

Executing trades in prominent meme coins is easier than ever now that liquidity, as measured by 1% market depth, has surged to record highs, according to data tracked by Paris-based Kaiko. The combined figure for DOGE, SHIB, PEPE, WIF, BONK, GROK, BABYDOGE, FLOKI, MEME, HarryPotterObamaSonic10Inu and HarryPotterObamaSonic, recently rose to $128 million, the data shows. The figure describes the total value of buy and sell orders within a 1% range of the current market price. The deeper the liquidity – that is, the higher the figure – the easier it is to execute large orders at stable prices.

"This suggests that while more market makers are venturing into providing liquidity for these tokens, they are still considered risky due to their high volatility," Kaiko added. "While part of this increase is related to price appreciations, many small-cap meme tokens such as Dogwifhat , Memecoin , or Book of Meme have seen significant growth in liquidity in native units, ranging from 200% to 4000%," Kaiko said in a weekly newsletter.in a variety of blockchain and digital asset businesses and significant holdings of digital assets, including bitcoin.

Source: Financial Digest (financialdigest.net)

 

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