The meme coin market has skyrocketed over threefold since the start of 2024. This rapid growth is a double-edged sword—some people are riding the wave to make big bucks, while others are left holding the bag. Platforms like Pump.fun, which launched in March 2024, let anyone create a meme coin for a small fee on the Solana blockchain, even if they have zero technical knowledge. As of November 7, Pump.fun boasts over 3 million tokens created, with the platform raking in close to $180 million in revenue. It even collects a 1% fee on all transactions, so it’s cashing in big time on the meme coin craze.
Meme coins, or “memecoins,” are tokens with little to no intrinsic value, usually created as jokes or to cash in on hype. They often play off internet memes, trends, or viral events. Creators of these coins usually don’t promise to keep developing the project, but buyers still jump in, hoping for massive returns in no time. The hype around meme coins has turned them into one of the fastest-growing segments in crypto in 2024, with the total market cap now over $67 billion.
According to Binance Research, the flow of cash into new meme coins has been off the charts. Some recent coins, like “dogwifhat” ($WIF), hit a billion-dollar market cap in just 104 days. The meme coin $GOAT hit $750 million in less than two weeks. Binance also noted that 75% of all meme coins were created in the past year, coinciding with the launch of Pump.fun.
But this gold rush isn’t benefiting everyone equally. Only about 20% of meme coin traders actually make money, and only 3% of them have pulled in more than $1,000, according to X user @arndxt. The “death rate” for meme coins is high too—Binance estimates around 97% of these tokens ultimately fail, making them incredibly risky.
Adding fuel to the fire, many meme coins aren’t just launched randomly; they’re carefully hyped by influencers and marketers who might take a cut of the tokens in exchange for promoting them. A good example is TrumpCoin ($DJT), which reached a $300 million market cap on rumors of being associated with Donald Trump, only to later tank when a well-known crypto detective, ZachXBT, revealed it was actually backed by notorious businessman Martin Shkreli. By November 7, DJT was worth just $3.3 million.
The danger of meme coins often lies in the “Pump & Dump” schemes, where insiders or promoters inflate the price of a coin and then cash out, leaving regular investors with worthless tokens. For example, in late October, an insider dumped 50% of all SHARP coins on the market, which caused its price to crash by 90% in minutes. ZachXBT has exposed influencers, or “Key Opinion Leaders” (KOLs), for using their following to drive up prices, only to sell off their coins and make a quick profit. Recently, he called out influencer Sion Thomas for hyping low-cap meme coins that usually go bust within a week. ZachXBT’s public list of “Pump & Dump” influencers includes around 50 names.
In short, meme coins might look like a shortcut to big gains, but for most investors, they’re a high-stakes gamble where the house almost always wins.
