TLDR
- Activity within the memecoin arena has plummeted over 90% in the shadow of the controversial Libra cryptocurrency misstep.
- Bobby Ong, the founder of CoinGecko, has opined that memecoins might currently be down for the count, yet he's convinced they'll make a comeback.
- The collective value of memecoins nosedived from an impressive $124 billion to just $54 billion, while trading volumes took a 63% nosedive.
- Veteran memecoins such as DOGE, SHIB, and BONK are prime examples of how nurturing fervent communities is key to crafting enduring value.
- In the face of regulatory grey areas in the US, developers found solace in memecoins rather than utility tokens, though this trend might shift with the new government in place.
The memecoin landscape has been severely bruised, knocked by contentious launches and alleged rug pulls dampening investor faith, according to insights from CoinGecko's own Bobby Ong.
Recent data suggests that token creation and trading momentum on the Pump.fun platform has dwindled by over 90% since February, largely due to the Libra token's chaotic debut.
Libra's introduction, controversially linked with Argentine President Javier Milei, witnessed insiders cashing out a whopping $107 million, decimating 94% of its worth soon after its debut.
In his March 6 report, Ong emphasized that if previous launches didn't stamp out memecoin mania, Libra surely put the final nail in the coffin, shattering the myth of memecoins being fair, only to reveal hidden profiteers.
This current downturn starkly contrasts with the hype that accompanied the introduction of the TRUMP memecoin, spurred by President Donald Trump's entrance into the crypto domain, which pushed Pump.fun to a peak of $3.3 billion in weekly trades.
However, since January, trading activity on the platform has decreased by 63%. The market as a whole has mirrored this downturn, with its total market cap shrinking to $54 billion from an all-time high of $124 billion in December.
Ong remarked that while memecoins may be riding the waves of market fluctuation, some, like DOGE, SHIB, and BONK, have emerged resilient from past slumps.
Why Some Memecoins Survive
Ong elaborates that successful memecoins are those that have formed dedicated communities around a shared passion, communities that resist the urge to sell and contribute organic stories and content.
The CoinGecko co-founder speculates the market may lean toward an 'extreme case of power law,' where a minuscule 0.01% of memecoins thrive as the majority flounder.
Ong also highlights the role of ambiguous regulations in fueling the memecoin frenzy, as the lack of clarity in token utility ushered projects toward memecoins as a shield against securities regulations.
A significant portion of the memecoin surge, according to Ong, can be attributed to regulatory failings, particularly in the US, where a clear pathway for token utility fundraising remains elusive.
The rise and drop of memecoins unfolds amidst a landscape of market turbulence. Bitcoin has seen a steep descent, from over $100,000 to roughly $87,000, paralleled by a 5% drop in the S&P 500.
Despite the current turbulence, Ong expresses confidence in the overall vitality of the crypto market, suggesting the downturn is merely a brief shakeout within a bigger bull cycle.
Token creation continues to surge, with GeckoTerminal tracking over 5.5 million tokens. January alone accounted for more than 600,000 new tokens, and Ong predicts the market could boast over a billion tokens within five years.
For those eyeing the memecoin space, successful stories of survival hint at the necessity of fostering robust communities rather than chasing transient profits. DOGE and SHIB Investment predictions indicate that Bitcoin might tip as low as $70,000 amidst market corrections, yet robust interest from institutions like Standard Chartered and Bitwise keeps speculations alive for potential highs north of $200,000.
Delving beyond memecoins, tokenization stretches into AI agent platforms, DAOs, and diverse real-world assets, even as prominent finance firms pivot towards the RWA segment, initially focusing on US treasuries with expectations of branching into higher-risk avenues. Bitcoin As the market progresses, attention emerges as a critical asset. A plethora of tokens and projects will vie for investor focus, yet only those of superior quality will stand apart.
Maisie brings rich experience as a Crypto and Financial journalist with articles for Moneycheck.com, level-up-casino-app.com, Computing.net, and serves as Editor in Chief at Blockfresh.com.
Dogecoin's (DOGE) price hinges on overcoming two major hurdles to potentially fuel a new rally.
