- Dogecoin could erase weekly gains and downside risk as The Washington Post finds legal action likely to be filed against DOGE.
- The lawsuit alleges that Elon Musk’s DOGE is a federal advisory committee and that it violates a 1972 law.
- The price of DOGE has already surged in response to updates on DOGE, an initiative led by Elon Musk and Vivek Ramaswamy.
- DOGE is holding above $0.3707, posting gains of nearly 5% on Monday.
Dogecoin (DOGE) rose nearly 5% on Monday as crypto tokens gain momentum ahead of Donald Trump’s inauguration. The Washington Post discovered a lawsuit likely to be filed against Elon Musk’s Department of Government Effectiveness (DOGE) as soon as the president-elect takes office.
Updates on DOGE have already influenced the price of the meme token and if the pattern repeats itself, traders could note a decline in the larger meme token.
DOGE Could Face Lawsuit Minutes After Trump Inauguration
After the results of the November 2024 presidential election, President-elect Donald Trump tapped Tesla CEO Elon Musk and biotechnology entrepreneur Vivek Ramaswamy to lead a department tasked with identifying government regulations and reduce overall White House spending.
In an unconventional way, the group proceeded to recruit staff and come up with a list of recommendations to be implemented in the new administration.
The Washington Post obtained the 30-page complaint, which alleges that DOGE is referred to as a “federal advisory committee.” FACA are legal entities regulated by the U.S. government that provide transparent and balanced advice to the administration. FACA is required to have “fairly balanced” representation, keep regular minutes of meetings, and allow public attendance and file a charter with Congress, among other key steps DOGE may have ignored.
The suit therefore alleges a violation of a 1972 law. Kel McClanahan, executive director of National Security Counselors, states in the suit:
“DOGE is not exempt from FACA requirements. All DOGE meetings, including those held electronically, must be open to the public.
Dogecoin derivatives traders are nervous
Data from crypto derivatives data tracker Coinglass shows that the volume of open interest (OI) and options in DOGE has decreased over the past 24 hours. OI fell 6.53%, to $5.25 billion, and options volume fell nearly 13% over the past day.
More than $43 million in long DOGE positions were liquidated in the last 24 hours, compared to $5.12 million in short positions. Derivatives data points to a price correction in spot markets.
DOGE Price Forecast
Dogecoin is in an uptrend and key technical indicatorsrelative strength index
(RSI) and Moving Average Convergence Divergence (MACD) support further gains in the meme coin. However, a decline in DOGE could push the meme coin towards the nearest imbalance zone formed between $0.2978 and $0.3270.
A decline to the lower limit of the imbalance zone marks a 20% correction in the DOGE price.
DOGE is trading at $0.3755 at the time of writing. The RSI reads 53 and is sloping upward, while the MACD is flashing green histogram bars above the neutral line.
DOGE/USDT daily price chart