Price gains in the AI memecoin FARTCOIN on Tuesday had crypto traders sniffing a market recovery.
After a steep plunge in memecoin prices on Monday, the FARTCOIN token jumped 13.8% in the last 24 hours. It was a sweet-smelling turnaround since the price gains pushed the market capitalization for the cryptocurrency – created a few months ago as a joke inspired by an AI chatbot – back over $1 billion.
Another popular memecoin, dogecoin (DOGE), gained 10% and was changing hands around 35-36 cents, the token’s highest price in seven days.
Bitcoin (BTC), Ethereum (ETH), XRP and Solana (SOL) each rose by at least 5%.
FARTCOIN, a Solana-blockchain-based memecoin that was launched on the token launchpad Pump.Fun in October, has garnered attention in crypto circles in part due to its connection to the surge in interest in AI chatbots and agents – not to mention the everybody-can-relate qualities of flatulence humor, with investors often reciting on social media “hot air rises” as an element of their bull thesis.
As to why FARTCOIN is so popular, Carlos Mercado, a data scientist at blockchain analytics firm Flipside Crypto, simply told Unchained over Telegram, “Everybody farts.”
Meanwhile, on Monday, Alex Krüger, founder of crypto advisory firm Asgard, revealed on X that he had a “very small position” in FARTCOIN because it’s funny, adding that he had pitched the AI memecoin to a large private equity firm.
Liquidity Matters
The token’s liquidity levels largely impact the price of FARTCOIN: “Liquidity isn’t everything, it’s the only thing,” Mercado said.
Pointing to the most popular liquidity pool for the SOL/FARTCOIN token pair on decentralized exchange Raydium, Mercado said, “You can see violent changes in available liquidity corresponding to both violent increases and decreases in the price.
“From Dec. 15 to Dec. 23 (per CoinGecko), prices moved from $0.60 to $1.12, then $0.65,” Mercado wrote. “This lines up with large swings in the liquidity flows too (although in both directions).”
Data from Flipside Crypto shows more SOL leaving the SOL/FARTCOIN primary liquidity pool than entering since Monday. Some 142.76 SOL has entered into the liquidity pool, while 225.47 SOL has left.
“In general, when liquidity is being withdrawn (SOL OUT), expect price volatility to rise,” Mercado stated in the data dashboard. At presstime, the liquidity for SOL/FARTCOIN on Raydium stands at almost $630,000, a roughly 64% decrease from $1.8 million at the beginning of year.
One crypto whale – a jargony term for a large trader – appears to have increased their holdings of FARTCOIN by nearly $3 million in the last 24 hours, per onchain data firm Nansen.
The whale’s blockchain wallet address was identified as “smart money” by Nansen – implying they may have been getting a whiff of a bargain on FARTCOIN.
