Author: Ryan S. Gladwin
Compiled by: Bai Hua Blockchain
The number of Tokens launched by the popular launchpad and cultural hub Pump.fun on Wednesday has decreased by 64.6% compared to the peak in January. Meanwhile, according to Dune data, the weekly graduation rate of Tokens has also dropped to the lowest level since July 2024. The so-called "graduation" refers to Tokens reaching a certain market value threshold, which was previously $69,000 but has been raised to $100,000 at the end of last year.
This lull has led some traders to believe that the Memecoin casino has closed and will never reopen. The founder of the crypto education platform Pluid, Loopify (alias), and a trader believe that the Memecoin cycle has ended. He pointed out that some data shows that the Memecoin craze has surpassed the peak of the previous NFT bull market.
According to Dune data, the most popular NFT marketplace OpenSea, which has been online since 2017, has generated $943 million in revenue, while Pump.fun has generated over $574 million in revenue since its launch in January 2024. Not to mention the revenue generated by trading bots, market makers, and other protocols that are crucial to the Meme coin economy.
Others, after seeing these statistics, believe it's time to abandon Pump.fun as the center of the Memecoin ecosystem.
"The era of Pump.fun is over," said the anonymous trader and WIFToken deployer Solana Bateman in an interview with Decrypt. "They have never given back anything, but have extracted too much." He added, "The difference between us and them is that we care about Solana, which is our home. But they only care about filling their own pockets."
These accusations often point to the launchpad, with opponents arguing that it has not done enough to develop the market, but has simply sold all the SOL generated by the platform - although the founders deny this claim. Bateman said the platform could improve by enhancing the Token economics, creating better liquidity pools, or providing more sustainable models, such as increasing Token unlocks at certain market caps.
"I also agree that Pump.fun's model is far from perfect, and I know the team has been working hard to find ways to improve," Pump.fun co-founder Alon Cohen told Decrypt in an interview.
"The design space for managing user incentives after creating a Token is very broad, so it takes time to perfect this. But from day one, Pump.fun has adhered to some principles that I believe are still valid today."
Cohen said these principles include keeping the entry barrier relatively low when creating Tokens, while pursuing "simplicity and elegance" because complexity will push retail investors away. He also added that he believes Pump.fun's standardized contracts have had a "hugely positive impact" on the ecosystem because they reduce the risk of developers creating and abusing malicious contracts.
How did we get here?
The collapse of Memecoins can largely be traced back to the launch of the official Memecoin of Donald Trump just days before his inauguration in January. The market was rife with frenzy, with speculators declaring a new era for Memecoins and cryptocurrencies.
The next day, Melania Trump also launched her own Token, causing the TRUMPToken to plummet - and MELANIA quickly followed suit. The mood shifted rapidly, and traders began to realize the "scam" at hand. According to DEX Screener data, TRUMPToken has fallen 85% from its all-time high, while MELANIA has fallen 94%.
These launched Tokens drained the liquidity of Memecoin traders, while also creating a large number of losers. Rennick Palley, the founder of the hedge fund Stratos, said in an interview with Decrypt. Over the following months, more large-scale Memecoin Tokens saw massive pumps and dumps within 24 hours, causing significant losses for traders.
Most notably, LIBRA briefly soared to a market cap of $1.17 billion after being promoted on social media by Argentine President Javier Milei, but plummeted 96% to $40 million in just six hours. Afterwards, widespread insider trading allegations erupted, involving multiple major protocols and influencers, and investigators found links between the Memecoin issuer and the team behind Melania Trump's Memecoin.
As the narrative of Memecoins being a manipulated game gained traction, the market's fear of the industry's complete corruption reached unprecedented levels. Bateman believes this was the "final nail in the coffin" for Memecoins.
"At first, [Memecoins] looked like a casino game," said Nick Vaiman, co-founder and CEO of the analytics firm Bubblemaps, in an interview with Decrypt. "But in reality, it was much worse: the game was rigged from the start." He explained, "Your odds of winning are almost zero, because the real winners are already predetermined: the insiders with advance knowledge, the savvy snipers who got in early, and the teams behind the scenes."
For some, this is enough to make them abandon Memecoins and start looking for more stable investments with real underlying value. VanEck portfolio manager Pranav Kanade told Decrypt that he expects funds to flow out of Memecoins and into "some niche Altcoins" because they can provide more psychological comfort. But not everyone is convinced.
"Many people don't like traditional VC-backed Altcoins with grand visions," Loopify told Decrypt, "so they're more likely to stick to single-culture Tokens or simply exit the market until new opportunities arise."
Crypto trader Murad Mahmudov once discussed his Memecoin investment theory, which centered on finding "cults" and buying their Tokens. However, according to CoinGecko data, none of the Tokens on his list have seen any gains in the past seven days.
Additionally, macroeconomic pressures are also driving the overall market downward. According to TradingView data, since the launch of LIBRA, Bitcoin (BTC) has fallen 17%, the S&P 500 index has fallen 2.7% in the past month, and the Trump administration's tariff policies have exacerbated market instability.
"Global liquidity has recently declined, and Memecoins are particularly sensitive to this change," Palley said, predicting that "it looks like liquidity has bottomed out, and Memecoins may see a recovery in the coming months."
Some traders in the market also agree with this view, with the anonymous Memecoin trader 0xWinged believing the market has overreacted and predicting that Solana will quickly rebound to $170, and market liquidity will also flow back into the Memecoin space.
"Ultimately, human nature loves gambling, and as subsequent market liquidity rebounds, I believe the funds participating in gambling will also increase," Palley said, adding, "Memecoins will continue to exist."
