Bonk (BONK), the top meme coin built on the Solana blockchain, has become the market’s highest gainer. This happened after the price jumped by 25.08% in the last 24 hours.
Though other altcoins and meme coins registered an increase, BONK’s rise to the top is due to a major announcement by its Decentralized Autonomous Organization (DAO).
A Big Plan Sparks a Huge Price Jump
On July 8, BONK DAO, via its X account, announced that it received a proposal to burn 84 billion from its treasury.
Token burn refers to the process of removing a number of cryptocurrencies from circulation. These tokens are usually sent to wallets where the assets cannot be spent or retrieved.
This strategic move usually enhances scarcity and boosts the cryptocurrency’s long-term value.
“BONK DAO is proposing a BURN of 83,917,950,070 BONK from its Treasury representing 100% of the BONK earned by BONK DAO from its revenue sharing agreement with BONKBot in Q2.” The BONK DAO statement read.
This is not the first time the team behind the meme coin has burned tokens. In April, 99.99% of its community voted in favor of a 278 billion BONK burn, and the broader market was in a bearish phase then.
But BONK was able to gain from the development as its price rose by 12% in a few hours. This time, the price of the token was initially down to $0.000021. However, at press time, the meme coin trades at $0.000027
Per on-chain data from Santiment, the outcome of the development is a rise in social dominance.
Read More: 11 Top Solana Meme Coins to Watch in July 2024
BONK Social Dominance. Source: Santiment
From the image above, the social dominance is 0.416%, reflecting a notable increase in mentions and discussions related to the meme coin.
If discussions around the token continue to rise, then the price may continue to move northward. For instance, the chart above shows how higher social dominance propels higher prices for BONK.
BONK Price Prediction: All Seem Set for $0.000029
The technical perspective also supports a further price increase. Looking at the daily chart, the Relative Strength Index (RSI).
The RSI uses a crypto’s speed and price changes to determine momentum. It also spots oversold and overbought levels, with readings at 30 or below being oversold and 70 and above indicating overbought points.
At 55.78, the RSI indicates that BONK’s momentum is bullish. The Chaikin Money Flow (CMF), which assesses the flow of money, is also on the cusp of breaking into positive territory.
BONK RSI and CMF. Source: TradingView
Collectively, the RSI and CMF indicate that BONK’s price has more room for growth. A further assessment of the chart shows that BONK seems to mirror its price performance in April. This was around the same period as the burn of that time.
During that period, the price went from $0.000014 to $0.000027 within a few weeks. If a similar thing happens, the price may jump to $0.000029. In a highly bullish scenario, the value can reach $0.000031.
Read More: Bonk Airdrop Eligibility: Who Can Claim and How?
BONK Daily Analysis. Source: TradingView
In addition, it is important to mention that the project’s community has six days to approve or reject the proposal mentioned above.
If they agree to support the token burn overwhelmingly, as they did two months back, the bullish prediction will come to pass.
However, if holders of the meme coin decide to book profits from the recent price hike, the price may fall. Also, if the community says no to another burn, the token’s price may decline to $0.000023.
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