The popular memecoin project on the Solana network, Bonk, became the market’s top gainer. BONK’s price increased by 25.08% in the last 24 hours, making investors happy. While many altcoin projects have seen increases, BONK’s rise to the top is due to a major announcement by the DAO. On July 8, BONK DAO announced via its X account that it had received a proposal to burn 84 billion tokens from its treasury.
What’s Happening with BONK?
Token burning refers to the process of removing a number of cryptocurrencies from circulation. These tokens are usually sent to wallets where they cannot be spent or retrieved. This strategic move generally increases scarcity and boosts the long-term value of the cryptocurrency. This is not the first time the team behind the memecoin project has burned tokens. In April, 99.99% of the community voted to burn 278 billion BONK, during a period when the entire market was in a downtrend.
However, BONK managed to benefit from this development with its price increasing by 12% within a few hours. This time, the token’s price initially dropped to $0.000021 and was trading at $0.000027 at the time of the news release. According to Santiment’s on-chain data, the development led to an increase in social dominance.
If discussions around the token continue to increase, the price may continue to move north. For example, the above chart shows how high social dominance leads to higher prices for BONK.
BONK Chart Analysis
The technical perspective also supports further price increases. Looking at the daily chart, the Relative Strength Index (RSI) is visible. RSI uses the speed and price changes of the cryptocurrency to determine momentum. It also detects overbought and oversold levels; readings of 30 or below indicate oversold conditions, while 70 and above indicate overbought conditions. An RSI of 55.78 indicates that BONK’s momentum is on the rise. The Chaikin Money Flow (CMF), which evaluates money flow, is also on the verge of entering the positive zone.
Collectively, RSI and CMF indicate that BONK has more room for growth. A more detailed assessment of the chart shows that BONK is reflecting its price performance from April. During that period, the price rose from $0.000014 to $0.000027 within a few weeks. If a similar trend occurs, the price could rise to $0.000029, and if the bullish scenario plays out, it could reach $0.000031.
