The memecoin market witnessed explosive growth in 2024, but its biggest players — including Dogecoin (DOGE), Shiba Inu (SHIB), Pepe (PEPE) and Dogwifhat (WIF) — are struggling to hold value anywhere near their yearly highs.
It’s not just top memecoins that are faltering. Numerous industry insiders have told Cointelegraph the current wave of tokens is having knock-on effects across the industry, with one saying memecoins have “sucked the life out of this bull run.”
Data released by Lookonchain on Sept. 2 revealed just how tough the market is for the incumbent pack of memecoins, which are down an average of 63%.
Millions of new tokens have been launched since March. Source: Dune Analytics/Adam_tehc
Crypto’s biggest memes are facing a market in which the rules of the game have changed.
Safe-launch services such as Pump.fun and BaseJump have made it easier than ever to launch new coins, removing technical and financial hurdles that previously constrained the market. The result is an increasingly competitive memecoin sector.
Ilias Salvatore, growth lead for token analytics tool Flooz, said the issue is one of attention, with this fast-moving market proving particularly alluring for some traders.
“I think that money flows where attention goes,” Salvatore told Cointelegraph. “Pump.fun and Solana have been the current craze to find new gems, but that’s also catering to a specific type of degen trader, [...] which is entirely different from leverage trading an established meme like Pepe on major centralized exchanges. Capital always rotates, but it also depends on your trading style and risk appetite.”
Carlos Mercado, a data scientist at blockchain analysis firm Flipside Crypto, said this new market encourages short-term thinking distinct even from the existing memecoin market.
“We do see onchain evidence of rotation — volumes peak for most memes early, and traders pivot to more recently launched coins,” Mercado told Cointelegraph.
He added that most safe-launch tokens last only 24 hours, with around 1% of successful coins lasting two to six days.
Memecoin numbers grow, but at what cost?
For degens playing the game, there are always new memecoins to choose from, with thousands of tokens created each day. On Pump.fun alone, over 1.98 million tokens have been launched since March.
Incumbent coins now face increased competition with so many potentials vying for user attention and investment.
A snapshot of tokens launched on Pump.fun on Sept. 11 shows that only 1.3% “graduated,” meaning it reached a market cap of $69,000, at which point it can be traded on the decentralized exchange Raydium.
But users appear to be losing out, as winning tokens are buried in an avalanche of losers. In August, Cointelegraph reported that a $100 bet on Pump.fun has worse odds of success than a spin on the roulette wheel at the casino.
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The long odds of picking a win have prompted even experienced memecoin traders to dub the current memecoin market a “slaughterhouse.”
On Aug. 30, cumulative revenue on Pump.fun passed $100 million. So far this month, the company has added another $4 million to that total.
Memecoins create liquidity concerns
Some industry figures are increasingly concerned about the memecoin market and its broader effects on other crypto markets. As they see it, memes are threatening to suck the life out of the current bull run.
Evan Luthra, creator of the non-fungible token housing project CasaNFT, is among those frustrated by the meme token surge and its wider implications.
“Memecoins are definitely taking away all the attention, and where our attention goes, that’s where our energy goes,” Luthra told Cointelegraph. “Memecoins are definitely mostly pumps and dumps, and they don’t create any inherent value.”
Slava Demchuk, CEO of the compliance and blockchain forensics firm AMLBot, sees evidence to support this theory.
“It is possible that memecoins have already sucked the life out of this bull run, and now money is being redirected into rug pulls and pump-and-dump schemes. That’s why there is no liquidity in the altcoin market,” Demchuk told Cointelegraph.
Flipside Crypto’s Mercado said, “Memecoins, especially celebrity coins without a dedicated community management team, are [...] extracting. The value flows to deployers, who then remove the liquidity via central exchanges.”
And Josh Benaron, founder and CEO of layer-1 programmatic data blockchain Irys, believes the current memecoin market has grown so large, so fast, that it is ultimately becoming self-defeating. He told Cointelegraph:
“There’s actually not enough demand left to keep creating so many new coins on Pump.fun.”
Beneron said both legacy memecoins and the current crop alike “are faced with little capital left.”
The data may tend to support Beneron’s thesis. On Sept. 8, daily revenue on Pump.fun fell to $262,000, its lowest level since May, although it has since returned to above $400,000.
A better plan
Luthra believes that for sustained success, blockchain players need to focus their attention on what drives long-term value.
“Degans should care about RWAs and AI because that is what is sustainable long term,” he said.
Benaron believes the obsession with memecoins is damaging, but imploring traders to mend their ways is unlikely to yield results.
“Memecoins are a double-edged sword,” Benaron said. “On the one hand, they pull liquidity away from real tech projects — distracting capital that could drive innovation. But on the other hand, much of that money is ‘mercenary’ anyway — capital that chases quick profits and moves on.”
More alternatives, more chains
The success of Pump.fun (built on Solana) and BaseJump (built on Base) has led to the creation of similar services on other chains, suggesting that the safe-launch trend is not yet over.
The launch of Ethereum safe-launch platform Ethervista made headlines earlier this month when one trader turned an initial $5,000 investment into $670,000.
On Aug. 13, the Tron-based SunPump safe-launch service was announced, and it has already launched over 80,000 tokens. The platform peaked on Aug. 21, with 7,531 tokens launched, generating $465,000 in fees.
SunPump peaked in August. Source: Dune Analytics
However, SunPump’s activity and fees significantly dropped off in August and early September, reflecting a similar trend of decreased activity on Pump.fun.
A spokesperson for memecoin Eth Bull (EBULL) told Cointelegraph, “The dip in the top 10 memecoins might signal that the initial hype is cooling off,” but added, “It’s still too early to call it the end of memecoin mania, though — things can change fast in crypto.”
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Danila Pronin, chief business development officer of Tron-based memecoin IVFUN (IVFUN), said it’s impossible to answer definitively whether this phase of the market has passed.
“Somewhere it’s fading, and somewhere it’s gaining momentum,” Pronin told Cointelegraph. “And in general, it will never go away forever. Memes were, are and will be. People love this class of crypto assets and will always come back to it.”
