Why Are Dogecoin and Shiba Inu Losing Ground to Bitcoin Despite Whale Buying?

Despite increased accumulation of Dogecoin and Shiba Inu by large holders, these memecoins have notably underperformed Bitcoin in recent months, losing market share and price momentum. This divergence highlights evolving investor preferences and technical factors that are reshaping the competitive landscape within the cryptocurrency market.

What happened

Recent data indicate that whale wallets—large holders of cryptocurrency—have been steadily increasing their balances of Dogecoin and Shiba Inu. On-chain analytics from providers such as Santiment and Glassnode, as summarized by CoinDesk, confirm this accumulation trend. However, this surge in token holdings by whales has not translated into upward price pressure or renewed retail investor enthusiasm for these memecoins.

In contrast, Bitcoin’s price trajectory over the same period has been supported by sustained institutional inflows. Documented filings and disclosures from Bitcoin ETF issuers, including Grayscale and ProShares, reveal increasing holdings in Bitcoin ETFs. These flows suggest a growing institutional appetite for Bitcoin as an investable asset. Unlike memecoins, Bitcoin benefits from a fixed supply cap of 21 million coins, a feature that underpins investor perceptions of scarcity and long-term value, as outlined in Bitcoin’s tokenomics.

Meanwhile, Dogecoin and Shiba Inu operate under inflationary supply models, with new tokens continuing to enter circulation. This fundamental difference in tokenomics, highlighted in their respective whitepapers and CoinDesk’s analysis, contributes to a divergence in investor sentiment. Market observers interpret Bitcoin’s institutional adoption and ETF inflows as evidence of deeper investor confidence and a shift toward viewing Bitcoin as a store of value. Conversely, memecoin demand remains largely speculative and sentiment-driven.

Some analysts suggest that whale accumulation in memecoins may reflect speculative positioning or attempts to support prices rather than strong conviction about their intrinsic value. Moreover, the lack of retail investor follow-through and subdued social media trends relative to Bitcoin’s macro adoption narrative have limited broader market enthusiasm for Dogecoin and Shiba Inu.

Why this matters

The contrasting market dynamics between Bitcoin and memecoins like Dogecoin and Shiba Inu underscore a structural shift in cryptocurrency investing. Bitcoin’s capped supply and growing institutional participation reinforce its emerging role as a digital store of value rather than merely a speculative asset. This shift is significant for market structure as it may influence capital flows, liquidity, and the overall maturation of the crypto ecosystem.

In contrast, memecoins’ inflationary supply and reliance on retail sentiment and social media trends expose them to greater volatility and weaker price support, despite whale accumulation. This divergence highlights the limitations of large-holder buying in driving sustainable price appreciation without broader market engagement. It also raises questions about the long-term viability of memecoins as investment vehicles compared to Bitcoin’s increasingly accepted status.

From a policy perspective, the institutionalization of Bitcoin via ETFs and other regulated vehicles could shape regulatory scrutiny and frameworks differently for Bitcoin versus memecoins. The evolving regulatory environment may further entrench Bitcoin’s dominance if institutional flows continue to grow while memecoin markets remain more fragmented and retail-driven.

What remains unclear

Several key uncertainties persist. The motivations behind whale accumulation in Dogecoin and Shiba Inu remain opaque, as blockchain pseudonymity and lack of direct disclosures prevent clear insight into whether these holdings represent genuine conviction, speculative bets, or attempts at market manipulation.

Additionally, the impact of evolving regulatory frameworks on future institutional flows into Bitcoin versus memecoins is not yet evident. Current ETF filings and disclosures do not address regulatory developments or their potential consequences for market segmentation.

There is also limited information on retail investor demographics and behavior beyond on-chain data, leaving gaps in understanding how shifts in retail participation might influence divergent price trajectories. Furthermore, potential effects of upcoming technical upgrades or ecosystem developments, such as Shiba Inu’s metaverse initiatives, on investor sentiment and price dynamics remain unquantified in the available data.

What to watch next

Disclosures from ETF issuers regarding institutional inflows and holdings, which may clarify trends in Bitcoin adoption and potential spillover effects.
Regulatory announcements or frameworks that could impact the classification and treatment of Bitcoin and memecoins differently, influencing institutional participation.
On-chain analytics tracking whale wallet activity and retail investor engagement to assess whether accumulation trends evolve or translate into price movements.
Developments related to memecoin technical upgrades or ecosystem expansions, such as Shiba Inu’s metaverse plans, and any measurable impact on market sentiment.
Emerging social media and retail sentiment data that could signal shifts in speculative demand or broader market enthusiasm for memecoins.

The divergence between Bitcoin’s institutional-driven momentum and memecoins’ reliance on speculative demand and whale accumulation presents an unresolved tension in the cryptocurrency market. While Bitcoin’s fixed supply and growing ETF adoption underpin its evolving role as a store of value, memecoins face structural challenges related to inflationary supply and weaker retail engagement. Understanding how these dynamics unfold amid regulatory and market developments will be critical to assessing the future trajectories of these digital assets.

Source: https://www.coindesk.com/markets/2025/12/18/dogecoin-and-shiba-inu-lag-market-as-memecoins-continue-to-lose-ground-to-bitcoin. This article is based on verified research material available at the time of writing. Where information is limited or unavailable, this is stated explicitly.