jakiro
Source: Coingecko; Compilation: Baishui, bitchain vision
In last month’sCoingecko: How did Trump affect the crypto market in January?》, I discussed how the cryptocurrency markets are raising and falling around Trump’s presidential actions and Meme coins.Not obvious at the time, butThe launch of $TRUMP and $MELANIA marks the pinnacle of Meme coins as it draws away liquidity and attention from all other cryptocurrencies.If the launch of these two Meme coins is not enough to end the Meme coins’s craze, then $LIBRA is the last straw that broke the camel’s back, breaking the fantasy of Meme coins being “fair issuance” and revealing the cabals and insiders profiting from almost everyone else.
Some of my thoughts on this:
1. Meme coins are dead now, but they will be back
Now it seems that Meme is dead because the indicator on pump.fun plunged immediately after $LIBRA was launched.Since its peak in February, the newly created tokens on the platform have dropped more than 90%.On CoinGecko, the market value of the Meme category has fallen by 32% since its peak on February 3, and trading volume has dropped by 72%.
It is worth noting thatMeme coins are always “seasonal”.But this also makes Meme coins that survive and prosper during the cycle especially rare.Meme coins such as $DOGE, $SHIB, $BONK have gone through the market cycle, providing lessons for Meme coins creators who are seeking to build long-term assets.
Looking back at Murad’s infamous “Meme Coin Super Cycle” speech on Token2049 in September, the most successful Memes are those who have successfully established cult-like communities that are passionate about a cause, not for sale, and can create content or stories organically.
In the era when there is no friction when launching Meme coins, attention is actually the product, and low-quality Meme will not have any development.Even the “higher quality” Meme needs to constantly attract users and keep their attention.Those who do this may have a chance to survive.
In the long run, Meme coins may follow the extreme situation of power law, with 99.99% of them failing.For the most powerful 0.01%, who knows they might even get a government agency named after them.
2. Should venture capital companies and regulators be blamed?
Take a step back,Last year’s Meme coin boom was actually caused by retail investors’ disappointment with the so-called “low-floating, high FDV” VC coin launched in early 2024.These transactions are signed at sky-high prices, and these tokens inevitably need to be issued at higher FDVs to bring returns to early investors.
Is the answer to a successful release possible in between?One of the most hyped issuances of 2024 was Jupiter’s $JUP, which subsequently sparked anger among investors for its “pump protection” issuance mechanism.In addition to airdrops, the team has also established a funding pool within a specific price range to provide liquidity for initial buyers and sellers.This means that the price of $JUP will remain within this price range for the first few days, limiting the volatility that usually occurs in the first few days of airdrops.
While this means $JUP’s price won’t surge immediately like the Rockets, it then hit a high of $2.00, close to three times the upper limit of seed liquidity of $0.70, while not breaking below the lower limit of $0.40.For long-term projects, this price stability may be preferable to “airdrop explosion” and then a sharp decline.
Other solutions, such as the well-curated angel joint investment platform like Echo.xyz, have also attracted attention, especially the recent MegaETH round, which allows retail investors to participate on the same terms as venture capital and angel investors.However,As the industry works through its own solutions, part of the responsibility for the Meme currency flooding should also be attributed to regulators, especially the U.S. regulators, as they fail to promote orderly fundraising to provide any form of practical tokens.
With no clear framework to issue tokens without triggering the securities laws, many projects end up raising funds from qualified investors, or go through a lot of trouble to find complex solutions, or simply create Meme coins that have no commitment to the holders.Hopefully, with the implementation of the new pro-cryptocurrency system in the United States, some common sense rules will be implemented, and we can all start building useful projects with useful tokens again.
3. We still believe that everything that can be tokenized will be tokenized
No matter what your opinion on meme coins,The large number of token launchpads that sprung up like mushrooms after the success of pump.fun will only accelerate the tokenization of everything.In addition to meme coins, we now have the AI proxy launchpad (Virtuals.io), and some other interesting DAO experiments (daos.fun) or “Tokenization Time” (Time.fun).
This hasn’t mentioned the accelerated progress we’ve seen in the RWA space, with major TradFi companies joining the competition.While Treasury bonds have been the dominant product for the past few years, the industry seems ready to start looking at more exciting products outside the risk curve.
What has this brought us?On GeckoTerminal,We are now tracking over 5.5 million tokens and creating over 600,000 new tokens in January.At this rate, we will easily exceed 1 billion tokens in the next five years.
Going back to my previous point of view, this means there will be a lot of tokens and projects competing for our attention (and money).How these projects will stand out will be very interesting.What we’ve seen on Meme coins in the past twelve months may be just a harbinger of the future, and only the best quality projects or tokens can stand out.
Some final thoughts on the current market
Trump promised some major reforms to the U.S. government when he took office, both at home and on the international stage, and he does seem to be fully implementing some of them.While DOGE (Ministry of Government Efficiency, not meme) and Elon Musk are making massive cuts to the federal government, Trump’s moves in imposing trade tariffs, and his ongoing role in the Russian-Ukrainian peace talks, have rocked the market.
The S&P 500 has plummeted about 5% in the past month, and cryptocurrencies have not been spared.Bitcoin has fallen more than 20% from more than $100,000 in the same period, and to the current $87,000, even Trump’s unexpected remarks about strategic cryptocurrency reserves cannot stop losses.
But for those who have been around for a while, you will know that even in a bull market, it will never be a straight up.Even in the previous cycle, $BTC experienced multiple 20%+ pullbacks during the uptrend to its previous high of $69,000, so there will certainly be volatility.Some CT people, including Arthur Hayes, said the current drop could be as low as $70,000, which would not surprise me too much.
I do believe we are still in a bull cycle and we are just experiencing short-term volatility.The Meme market may die in the near term, but institutions have a strong interest in $BTC.Don’t forget that just a month or two ago, institutions like Standard Chartered and Bitwise also called for $200,000 in BTC.There will be more in this cycle, so stay safe and don’t go bankrupt too early.
