Author: Arain, ChainCatcher
The summer of Meme is being declared over.
From the collapse of the Trump family's $TRUMP to the exposure of the $Libra scam at the Argentine president's rally, Solana, which sees Meme as the core driver of on-chain transactions, has seen its on-chain transaction volume halved and the daily issuance of new coins reduced by 70%. The top Meme coins have fallen more than 70% year-to-date... All signs indicate that the Meme bubble, with a total market cap of nearly $60 billion, is also starting to show cracks.
Bitwise Chief Investment Officer Matt Hougan, Dragonfly Managing Partner Haseeb Qureshi, and Castle Island Ventures Partner Nic Carter, among other investors, have recently published views shorting the Meme market.
"I still can't lie flat, I have to do something," Philo said in an interview with ChainCatcher. Philo, who calls himself P Xiao Jiang, recently publicly stated that he had successfully landed and cleared all his Meme assets, but he couldn't lie flat during the time he should have been lying flat. Philo told the ChainCatcher reporter that he has decided to start a business to build a platform to short Memecoin.
This decision means that Philo is shedding the identity of "P Xiao Jiang" and undergoing an identity transformation. Philo's transformation is a microcosm of the thousands and thousands of P Xiao Jiang in the context of the sudden cooling of the Memecoin market.
Meme Coins Encounter a "Waterloo" P Xiao Jiang Reach a Crossroads
According to Google Trends, the global search heat for "Memecoin" has plummeted after reaching a peak in January, shrinking by nearly 60% by the end of February. Coingecko statistics show that the Meme sector has been among the worst performing Top 10 assets in the crypto market in the past 7 days, with well-known Meme coins like TRUMP and MELANIA down more than 70% year-to-date, and even blue-chip Meme coins like DOGE and SHIB recording negative returns.
The Meme secondary market is in dire straits, and the on-chain market is also in a slump. Dune Analytics shows that the daily trading volume of the Meme coin issuance platform pump.fun has plummeted from $3.9 billion on January 24 to $1.34 billion in February, a drop of 64.83%; the number of newly issued tokens has dropped from 61,800 per day to less than 30,000, a drop of more than 50%.
Faced with the Meme recession, Bitwise Chief Investment Officer Matt Hougan publicly stated: "...Over the past year, Memecoin has been the hottest sector outside of Bitcoin in the crypto currency space. Removing Memecoin activity from the crypto ecosystem will have an impact, and that's what you're seeing today."
Philo was once a P Xiao Jiang in the Memecoin wealth creation wave, and he chose to retreat from the tide at this point. But few would have imagined that this young man who seized the Meme opportunity is only a senior in college, and due to his obsession with researching cryptocurrencies, he "voluntarily" gave up his studies - he just received a withdrawal notice.
"I spent most of my time not at school, so I received a withdrawal notice. Going to college is just to get a job in the future, but my actual experience tells me that it's easier to achieve the goal of making money in the Crypto circle - you may be able to make in one year what it takes most people decades or even a lifetime to make," Philo told the ChainCatcher reporter.
Philo's experience is full of drama. As a civil engineering student, he taught himself programming as a hobby. In fact, Philo openly admitted that in the past few cycles, he has seized the opportunities of DeFi and NFT, and is most satisfied with earning money through his GitHub account, which made him realize "this is a high-profit business with no cost", so he has gone further and further on the path of programming and cryptocurrencies, and he has even won several hackathon awards.
However, the gold mine he dug up in the Memecoin wave made him feel that he could take a break for a while.
Why did he choose to shed the identity of P Xiao Jiang at this time? Philo said it was his instinct that told him to do so, "I have investment experience and entrepreneurial experience, and my experience tells me that in both investment and entrepreneurship, not only technology and vision, but luck also accounts for a large part."
Shedding the identity of P Xiao Jiang has made Philo's life calmer for a while, "The sense of comfort, happiness and security have all improved." But after less than half a month, Philo couldn't sit still, and he turned his attention to entrepreneurship, saying he was developing two projects, one a Bitcoin stablecoin and the other a platform to short Memecoin, "I think shorting Memecoin is an opportunity, as there are now many platforms in the market that help Memecoin longs make money, but there is still a lack of opportunities for shorts to make money. For me, entrepreneurship is more about whether it is something I want to do and the positive impact on the industry than profit. Even if I lose money on entrepreneurship, it's still giving back to the market."
Some P Xiao Jiang chose to leave at this time, but some also chose to hold their ground and upgrade to P Marshals. KOL @YuYue in the Memecoin field told ChainCatcher in an interview that her life hasn't changed much, "but I will focus more on life, looking at more new projects, and making friends. In the future market, I will still actively follow the Meme track and various emerging on-chain Alphas, because this form of asset issuance itself has transcended the cultural concept of Meme and exists, so I am very optimistic about the future on-chain assets and on-chain Meme having more opportunities, and I will act accordingly when the time is right."
The Davis Double Whammy Crisis: Bubble Burst and Solana Selloff
P Xiao Jiang have reached a crossroads and made different choices, which is related to their judgment of the future market.
Although the data shows that Memecoin is starting to cool down, Yuyue does not believe that the Meme track story is over.
"I think this change is a natural phenomenon, but it doesn't mean the 'tide is out' or the track is over. In fact, the Meme craze has basically lasted for more than a year, from the Meme coins like WIF and BOME last year, it's been over a year, and this cycle and vitality have far exceeded all other sub-tracks, so the entire Meme track is in a mood trough, which I think is a normal phenomenon," she said in the interview.
In the past period of time, the out-of-circle effect of Meme coins has mainly relied on celebrity coins. Because celebrity coins often have a certain fan base and stronger topicality, celebrity Meme coins are more likely to become popular. But success and failure are both due to Xiao He. Meme was pushed to a high point by celebrity coins, and it was also criticized because of celebrity coins. Events like the collapse of the Trump family's TRUMP and the Libra scam have accelerated the market's collapse of confidence in Memecoin.
Treeverse founder Loopify publicly stated: "Meme coins are like NFTs in the last bull market, with only bubbles left after the tide goes out." Taking TRUMP token as an example, its market value once soared to $70 billion, but the lack of real use cases was exposed, and the price quickly returned to zero.
In this wave of celebrity Memecoins, Meme also seems to have lost its original intention. Initially, retail investors were keen on playing Meme largely to fight against VC Coins, but today, retail investors are still the injured party.
Dragonfly Managing Partner Haseeb Qureshi said in a recent podcast: "People seem to realize the essence of the Meme promoters and how the massive Meme coin issuance game is detrimental to retail investors... People are becoming skeptical about how Meme coins operate, and it's uncertain whether retail investors can continue to participate in this so-called 'casino'."
A leader of the Memecoin research community told ChainCatcher: "The new retail investors have basically been cut."
In addition to the Meme bubble itself beginning to dissipate, the market is gradually shifting towards more conservative asset attributes, putting Meme coins in a situation similar to a "Davis double whammy". Since January 2025, the net inflow of Bitcoin ETF funds has reached $43 billion, while the capital outflow of Solana, the main battlefield of Meme coins, has exceeded $12 billion during the same period. Furthermore, Solana will face the pressure of unlocking 112 million SOL on March 1, which were sold at a low price of 30%-40% of the market price to institutions by the FTX bankruptcy liquidation assets, and the market is worried that the unlocking will trigger a selloff, and the decline of Solana's price will further drag down the prices of the Meme coins that use it as the main battlefield.
However, YuYue pointed out to ChainCatcher that "in fact, the overall environment of other tracks, including the ecosystems of various public chains and DeFi, etc., are not so optimistic. The core reason for the market downturn is still liquidity, which is the problem faced by all tracks and ecosystems in the currency circle at the moment."
The Second Half of the Meme Players: Either Fold or Shift
Where will the meme players go in the second half?
On February 19, during the "Trends and Rhythms of the New Web3 Cycle" event hosted by RootDtata and ChainCatcher at Consensus HK, Cooking.city partner & EVG co-founder Kyle, Paper Venture investor 0xbing, crypto KOL YuYue, Asian on chain founder Vand Ni, and OKX Web3 product manager Leo Li engaged in a roundtable discussion on the topic of "The Advancement Path of Meme and P-Soldiers". In this roundtable, they discussed the outlook for the meme market in the second half.
A consensus is that the second half of meme will be a more intense and challenging PVP battlefield. YuYue believes that meme may have a longer lifespan than most narratives, forcing the market to rethink the valuation system, and the second half will be a more brutal PVP battlefield where everyone needs to find their own positioning. Leo Li believes it is necessary to reduce trading frequency, as high-frequency PVP is too challenging for many ordinary players.
Meme has also spawned some other gameplay. For example, Time.fun which tokenizes "time", Monsters.fun which combines AI agents and game economics, and Nad.fun which introduces anti-MEV mechanisms and social credit airdrops, continue to join the exploration of Meme 2.0.
But perhaps like the once glorious narratives in the market, there was no DeFi 2.0 after the DeFi Summer, and no Meme 2.0 after the Meme winter, the new narratives captured by the market may start in other places.
And on-chain there are not only meme and celebrity coins. According to Dune data, since the beginning of the year, the narratives of Derivatives, FriendTech and RWA have started to outperform the market.
Behind these three narratives is the rhythm of institutional capital entering the market.
Among them, RWA, as a trillion-dollar track under the compliance wave, has already attracted large institutions to participate in the past year. DefiLlama data shows that the TVL (Total Value Locked) of the RWA sector will break through $80 billion in Q1 2025, a 300% year-on-year increase. Traditional institutions such as BlackRock and Fidelity have entered the field, and the stablecoin bill being pushed by the US Congress will further drive the compliance process.
The DeFi market has begun to show signs of recovery at the beginning of this year. According to Messari's report, although the trading volume and TVL of the DeFi market will decline in 2024, the liquidity will remain strong in early 2025, showing the resilience of the market. For example, Plume Network attracted over $4.5 billion in asset commitments before launch, with a TVL of $64 million; Uniswap V3 continued to lead the DEX market in early 2025, accounting for more than 40% of the market share; the TVL of lending platforms like Aave and Compound also rebounded in early 2025, especially Aave's expansion on Polygon, increasing its TVL from $6 billion to $12 billion.
It is worth noting that Coinbase's BTC-backed loan product has attracted more mainstream users to the DeFi field. In addition, the integration of RWA is also seen as an important growth point for the DeFi market, such as Tradable's collaboration with ZKsync to bring $1.7 billion in credit assets on-chain.
