Memecoins Lose 61% Market Value As Speculation Fades

Memecoins faced one of their most challenging years in 2025, losing more than 60% of their market value. While the broader cryptocurrency market reached new highs above $3 trillion, the total memecoin market capitalization fell from $93.1 billion in January 2025 to $36.5 billion by January 2026, according to BestBrokers. 

Why Did Memecoins Collapse While Crypto Markets Grew?

The collapse of memecoins contrasts sharply with the broader crypto market, which briefly touched $4 trillion in market capitalization late last year. Several factors explain this divergence:

• Speculative Demand: Most memecoins in 2025 were driven by short-term trading. Investors poured capital into new tokens without assessing long-term value.
• Market Flooding: Launchpads like Solana’s Pump.fun allowed tens of thousands of new tokens to enter the market daily, overwhelming investors.
• Volatility Amplifiers: Political memecoins like TRUMP and LIBRA generated spikes in interest but collapsed quickly as hype faded.

Alan Goldberg, analyst at BestBrokers, described the trend as “a textbook post-hype unwind,” where market capitalization lacked underlying support once trading activity declined.

How Severe Was Trading Activity Decline?

Trading activity mirrored the drop in market value. Memecoin volumes peaked near $20 billion in mid-2025 but slid to under $3 billion by December. Volumes have recovered slightly to $3.4 billion, according to BestBrokers.

• The fourth quarter saw a sharp reduction in active tokens. CoinGecko analyst Shaun Paul Lee reported that 7.7 million tokens listed on GeckoTerminal ceased active trading in the period.
• The Oct. 10 crash, which liquidated $19 billion of crypto leverage in a single day, was a key trigger for the memecoin sector’s sharp declines.

Lee added that the rate of token failures accelerated significantly. Over 1.3 million projects failed in 2024, compared to just 2,584 in 2021. 

Did Launchpads Fuel the Memecoin Surge?

Launchpads played a central role in the 2025 memecoin surge. GeckoTerminal data shows total token listings rose from 3 million at the end of 2024 to 20 million by year-end 2025.

• Pump.fun Launch Impact: The Solana memecoin launchpad Pump.fun, launched in January 2024, made it easier to create new tokens rapidly.
• High Failure Rate: Many of these tokens were low-effort projects with limited technical backing. Most did not survive past a week.

Lee noted that before the launch of Pump.fun, cryptocurrency failures were in the low six digits. The relative ease of creating new tokens in 2025 drove market overcrowding, reducing rarity and investor confidence.

What Role Did Political Memecoins Play?

Political tokens amplified the sector’s volatility. The TRUMP token, linked to U.S. President Donald Trump, went viral during the U.S. election season. Similarly, LIBRA, associated with Argentine politician Javier Milei, fueled speculation in Latin America.

• Market Peak and Collapse: Memecoins peaked at $150.6 billion at the end of 2024, per CoinMarketCap. Within weeks, the market fell to $47.2 billion by November 2025, a loss of over $100 billion.
• Excessive Launches: At the start of 2025, around 73,000 new tokens were launched daily via platforms like Pump.fun, contributing to market saturation.

These high-profile tokens initially drew attention but failed to sustain value.

How Did Scams and Rug Pulls Affect Investors?

Scams and deceptive practices were a critical factor in the memecoin decline. Anonymous teams exploited hype to launch artificial projects, often exiting with funds in rug pulls.

• Tactics Used: Bundling wallets to simulate demand, using hype houses and bots, and promoting projects through rapid social media campaigns.
• Investor Impact: Many small holders lost their investments as tokens disappeared within hours. Even established exchanges like Coinbase faced criticism for listing ultra-speculative memecoins.

Despite these issues, independent memecoins still dominate 86.2% of the market. 

Which Memecoins Survived or Adapted?

Some memecoins adjusted to the harsh conditions by evolving their utility.

• Dogecoin: The original memecoin retained 47.3% market share in 2025, proving resilience due to community support and established network effects.
• BONK and FLOKI: These tokens moved toward DeFi integration, gaming, and other applications, aiming for more durable use cases.

Currently, Dogecoin and Shiba Inu together account for roughly 84% of total memecoin capitalization, valued at about $25.3 billion and $5.2 billion, respectively.

What Are the Early 2026 Trends?

Memecoin capitalization rebounded slightly at the start of 2026, rising from $38 billion on Dec. 29 to $47.7 billion by Jan. 5, before cooling to $44.84 billion on Jan. 12. However, most new tokens, including TRUMP, continue to underperform. TRUMP currently trades at $5.46, up 8% weekly but down 81% over the past year.

• Launchpad Activity: Daily new wallet sign-ups on Pump.fun dropped roughly 66% over the year, from nearly 186,000 to around 30,000.
• Market Concentration: Independent memecoins still lead the market, while launchpad projects struggle to achieve sustained trading or market impact.

Conclusion: What Memecoins Demonstrate

The memecoin market in 2025 highlights the sector’s volatility, speculative nature, and vulnerability to market saturation. While a few established tokens show durability and adaptability, the overall landscape remains risky. Investors must consider tokenomics, liquidity, and project backing rather than viral trends alone.

Resources

1. Report by The Defiant: Memecoin Market Cratered More Than 60% in 2025: Report

2. Report by CoinGecko: Dead Coins: Over 50% of Cryptocurrencies Have Failed

3. CoinMarketCap memecoin portal: Memecoins data

4. Report by CoinTelegraph: Memecoins hit hardest in rough year that saw 11.6M tokens fail