$73bn Memecoin Wipeout Since Dec As Investor Appetite Wanes
$73bn Memecoin Wipeout Since Dec As Investor Appetite WanesBy Vishakha Thakur
Memecoins continue to show a downward spiral with many dark clouds surrounding them from all sides. Scams and pump-and-dump schemes have eroded much of their appeal, and tech czar Elon Musk comparing them to a casino has further worsened their prospects. $73bn Memecoin Wipeout Since December As Investor Appetite Wanes.
In December 2024, the memecoin market cap was $127bn, but now it has dropped to $54bn, representing a $73bn wipeout. Looking at December’s charts of the top 5 meme coins by market cap: the market cap of Doge has declined from $68bn in December 2024 to $30bn, Shiba Inu’s market cap dropped from $19bn to $7bn, Pepe’s market cap fell from $11bn to just $3bn, and the Official Trump memecoin’s market cap dropped from around $15bn in January to around $2bn since its launch. Meanwhile, Bonk’s market cap has declined from $3bn to $968 million.
The major factors responsible for the decline include a shift in the narrative towards AI tokens and the recent Libra Memecoin controversy. Along with the market cap decline, investor interest is also waning. Solana-based popular meme coin launchpad, Pump.fun’s trading volume has dropped by 63%. This week, two important statements came to light. First, the US Securities Exchange Commission (SEC) issued a statement that meme coins are not securities but collectibles. Secondly, Elon Musk, Tesla’s tech maverick, compared the sector to a casino during a podcast. So not all is well with the world of memecoins.
Factors Responsible For The Decline: Shift In The Narrative & Libra Controversy.
According to data from Dune Analytics, from January to February 2025, meme coin launchpad Pump.fun’s trading volume dropped by 63%. Overall, the platform’s trading volume declined from $119 billion to $44 billion in the first two months of 2025, with $2.1 billion in trading activity recorded in the past four days.
As for new token listings, in January, around 1,200 tokens were launching daily, but now only 300 are being listed.
Pump.fun co-founder Alon Cohen says that because the entire crypto market has experienced a decline, meme coin trading volume has decreased, but revenue has not been affected. According to Dune Analytics data, Pump.fun’s revenue in the last 30 days has been approximately $74 million.
According to the SEC, meme coins typically have limited or no use or functionality. Meme coins are often purchased for entertainment, social interaction, and cultural purposes, with their value primarily driven by speculation. In this regard, meme coins are similar to collectibles.
Since meme coins do not generate yield or future income, nor do they profit any business indirectly, unlike stocks and bonds, they are not considered securities.
This statement from the SEC is somewhat positive for the meme coin market because it clarifies that people who participate in the offer and sale of meme coins do not need to register their transactions with the Commission under the Securities Act.
However, there’s a negative factor too. Fraud and scams are likely to increase, as the SEC itself has stated that neither meme coin purchasers nor holders are protected by federal securities laws.
So investors need to remain cautious, especially since tech maverick and Doge meme coin promoter Elon Musk has also said that meme coins are like a casino. If you expect to win at a casino, you’re being a fool.
So, it’s for you to decide whether you want to invest in high-risk, high-reward meme coins or be an informed investor, but please exercise caution in all your investment decisions.
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