Data from various sources in the crypto industry is showing a notable trend: the memecoin frenzy seems to be cooling down. While leading memecoins remain relatively stable, some signs of decline have become evident over the past month.

Memecoin: Local success but global recession trend

Some memecoin assets are still recording impressive growth, however, a downward trend is quietly occurring on a large scale. About a month ago, the memecoin space was filled with excitement with growth momentum significantly surpassing that of leading altcoins. For example, DWF Labs launched a $20 million fund to support memecoin projects.

However, according to new data, trading volume in this sector has sharply decreased from about $30 billion to below $14 billion.

Memecoin sees a decrease in trading volume and market capitalization | Source: CoinMarketCap

While leading memecoins maintained stable performance this month, investor attention is often diverted by emerging assets. For example, FARTCOIN surged 200% at the beginning of December, while veteran coins like DOGE saw a decline. Similarly, POPCAT recorded outstanding performance in November but quickly lagged behind. This suggests that the growth of some assets often overshadows the decline of others, but overall, the memecoin market is underperforming.

Memecoin ranks last in the performance table of the industry | Source: Artemis

It is very difficult to comprehensively explain these trends. Perhaps negative events like the notable rug pull scam of Hawk Tuah have significantly eroded market interest. Additionally, data from CryptoQuant indicates that a majority of memecoin traders are losing money, at least on some trading platforms. The dominance of memecoin compared to altcoins is also sharply decreasing, indicating that the appeal of this segment is weakening.

Memecoin is losing market dominance | Source: CryptoQuant

Memecoin market forecast

Although current signals are concerning, it is still too early to conclude that memecoin will enter a long-term bear market. For instance, November trading data had previously suggested an upcoming altcoin season, but the actual price increase did not occur.

Therefore, the current downward trend may only be a temporary phenomenon. However, traders need to monitor closely and be cautious of bearish signals to make reasonable investment decisions.



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