dego Finance Token Plunges, Echoing MantraS Collapse
On Wednesday, teh Dego Finance (DEGO) token experienced a dramatic 40% drop. This sudden fall erased all gains from the past few months, bringing back memories of the recent Mantra (OM) collapse.
The crash led to important liquidations. CoinGlass reported that long positions worth over $650,000 were liquidated,marking a record high for the token. The plunge followed the movement of over $250,000 worth of DEGO tokens to exchanges, ending a ten-day period of net outflows.
Similar to Mantra’s 90% plunge, there was no major news event behind DEGO’s fall. Mantra’s developers cited forced liquidations from an unnamed exchange as the cause. DEGO’s crash happened on the same day the developers announced they were buying USD1, a stablecoin by Donald Trump’s World Liberty Financial on the BNB chain.
Some social media users warned that this announcement could be part of a rug pull scam. DEGO’s tweet about backing USD1 liquidity on BNB Chain raised concerns.
Technically, DEGO’s price peaked at $2.8600 last week. Though, Wednesday’s nosedive retested the year-to-date low. The token fell below key moving averages and the lower side of an ascending channel.
With the Relative Strength Index and MACD pointing downwards, DEGO’s price is likely to continue falling. It could drop below $1. A possible relief rally, or “dead cat bounce,” might occur, but the downtrend is expected to resume.
Mantra’s price action provides a similar pattern. After plunging to $0.3834 on April 13,it briefly rebounded by 157% before continuing its decline. It now trades 18% below the initial plunge.
