Hardly a week passes without one memecoin or the other making big news. These meme crypto tokens have become ubiquitous and almost become a part of our daily lives. According to DEX aggregator reports, about 40,000 to 50,000 new meme tokens are created daily, and the number can spike to as high as 100,000 during viral moments. Part of the appeal of memecoins is that they are all over the place, but could that also be why they are now dying? This article will explore memecoins, their rise, and what may very well be their demise. 

The Hype Cycle: From Viral Growth to Market Saturation

Memecoins started in the early 2010s without much appeal until one Japanese dog smiled them into the mainstream. Dogecoin (DOGE) was the most prominent memecoin. It was based on a popular meme of Kabosu, a Shiba Inu dog. The internet loved the coin, and it started seeing a steady trajectory. Add Elon Musk’s famous endorsement of the coin, and the rest is history. Dogecoin shot up and eventually reached an ATH of $0.74 sometime in April 2021.

Following DOGE’s success, millions more memecoins shot up. Between April and May of 2024 alone, Cointelegraph reported that more than one million new tokens had been created, and the market was really good for them. Following a steady rise, the memecoin market hit an all-time high of $137 billion in December 2024. Cryptonews data also showed that the market cap of memecoins was $105.8 billion in January. It was a good run for the asset, but has that race come to an end?  

Compared to today’s market cap of $53,134,248,500 on CoinGecko, which marks 56% from its ATH, it is obvious that something is going wrong somewhere. But what happened to memecoins, and is there hope for a comeback? Will memecoins recover?

Factors Leading to the Decline of Memecoins

Memecoins have come a long way from what they used to be, but that decline did not come out of the blue. Everyone, from crypto analysts to finance experts, has an opinion on why memecoins are failing. Here are a few of our thoughts on why memecoins, once top stocks, have become almost laughing stocks. 

1. Massive Sell-offs: 

Nothing shakes a token’s performance more than liquidations; in late 2024, there were many of them. Going back to Q4 of 2024, there was a massive memecoin rally, and industry analysts have pointed out that many investors who got in on this rally early took out their investments at once. This caused liquidations of 1.7 billion in 12 hours for the broader crypto market, leading to the current market downturn.

2. Lower Trading Volumes: 

Another thing that hurts any token market is lower trading volumes; memecoins have had it really low recently. Data from Blockonomi shows that token creation and trading activity on Launchpad Pump.fun has fallen by more than 90% since February. While the reasons for it are unclear, it is evident that the market sentiment towards memecoins has not been very good. This has caused a significant reduction in investors participating in the memecoin market and, by extension, a reduction in the market performance.

3. Lack of Utility: 

Memecoins have had plenty of challenges in the past, but one has stuck more than any other: the lack of utility. Memecoins are usually not built on any utility-backed projects. Instead, they are more often built on hype, which is proving not to be a very good foundation as the hype has now died down, along with the market performance. Investors now seek other cryptos with more tangible benefits and use cases.

4. Increased Competition: 

Blockchain and crypto projects are being created by the minute, and it seems the competition is really getting to the memecoin market. Combined with the widespread lack of utility, it is not difficult to see memecoins unable to take the heat of competition.

5. Regulatory Uncertainty: 

Cryptocurrency has long been a regulatory mixed pot, with no concrete regulatory framework established to guide the use and administration of these tokens. This lax attitude towards crypto and memecoins has opened the doors for potential market manipulation of price trends and insider trading, further worsening the market sentiment for memecoins.

Libra Coin: The Turning Point For Memecoins

While the more “memeable” coins usually take the front spot when memecoins are mentioned, one big sector of memecoins secretly runs the show, and that is the political coins. These coins are also a driving force in the memecoin world, but just one of them might have killed it off.

Libra is a cryptocurrency that briefly surged on Argentine President Javier Milei's support. Afterwards, it crashed and crashed big. The coin was launched after Donald Trump and Melania released their individual coins. Both saw huge gains and made a lot of money, but the story was different for Libra. 

After being promoted right out of President Milei’s X account, the coin peaked above $4.50. Then it crashed by more than 95% just a few hours after its peak. This humpty dumpty level of great falls had the Argentine President deleting his X posts supporting the coin and denying any involvement with it.

Following the Libragate fall, industry experts have revealed that it might just be the end of the road for memecoins. Among many other crypto experts, Nic Carter took to X to say that “Memecoins are unquestionably over” as the Libragate scandal has supposedly revealed the “corrupt memecoin” sector. This major scandal has left many in the crypto market wondering if memecoins can still be trusted, and we’ll get to that.

Current Market Status: Are Memecoins Still Relevant?

There’s no shying away from it.  Memecoins are in a terrible spot at the moment, which has left many people to wonder, "Is the memecoin cycle over?” and whether these dying coins still have any relevance. 

While there is no straight answer, many industry experts have chosen to stay optimistic. Bobby Ong, for one, has suggested that memecoins may be down, but they are far from done. He has, however, said that the most likely scenario is that 99.99% of tokens will fail while only a select few will endure market cycles and establish themselves as long-term assets. He then pointed to memecoin giants, including DOGE, SHIB, and BONK, to illustrate that memecoins with strong communities and viral appeal can survive beyond initial hype cycles and establish themselves among the big crypto players.

This view is by no means the final say on the future of memecoins, but we believe that there are three things that can help memecoins seemingly rise again.

• Utility & Ecosystem:  

If more memecoins start offering real use cases like the more established crypto, they might start to enjoy the same longevity. 

• Community Power: 

Memecoins live off majorly on hype, but that hype comes from the token’s community. With stronger community involvement, there’s a more-than-good chance that memecoins can make a comic comeback. 

• Mainstream Adoption: 

Mainstream adoption is the ultimate joker when it comes to the survival of any token. With more and more exchanges and payment platforms accepting memecoins, their legitimacy is given a huge boost, and they might become staple products in the crypto space. 

Is the Memecoin Cycle Truly Over?

Sure, things look bleak for memecoins at the moment, but it might not be best to jump to conclusions and start expecting a Memecoin crash 2025. Turbulent times like this are not news in the crypto world. Even big players like Bitcoin and Ethereum have gone through similar times in past crypto market trends. 

Many industry experts believe memecoins could return to the limelight in the next bull market. Historically speaking, speculative assets like memecoins usually see renewed interest when market conditions improve. 

However, this market downturn has proven that memecoins cannot be sustained if they keep operating the way they have been. Tides are changing, and if they are to survive, memecoins will need to adapt and rebrand. First, real-world utility must be adopted for memecoin projects to secure serious investors. A new wave of trusted influencers helping with hype could also be helpful. 

One thing to keep investors hopeful in the Memecoin market 2025, as they consider memecoin investment risks, is the recent return of non-fungible tokens after years of relative dormancy. If the dead can rise again, why not also the dying?

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