The memecoin craze in the cryptocurrency market has taken a hit with the launch of Official Trump (TRUMP) and Melania (MELANIA) digital assets, according to a recent report from CoinGecko. The report indicates that the memecoin sector saw a significant decline following the introduction of these high-profile tokens in mid-January.
Furthermore, the launch of memecoin Libra (LIBRA) in February also contributed to the downturn of the sector. Initially backed by Argentinian President Javier Milei, LIBRA saw a surge in market cap to over $4 billion on its launch day, only to plummet by more than 95% shortly after.
The report suggests that the launch of TRUMP and MELANIA marked the peak for memecoins, diverting attention and liquidity away from other cryptocurrencies. The subsequent launch of LIBRA further exposed the flaws in the memecoin market, revealing instances of insider profiting and cabals manipulating the system.
Currently, the memecoin sector is experiencing a decline in market cap and trading volume, with a 32% decrease in market cap and a drastic 72% drop in trading volumes since its peak on February 3rd.
Despite the current downturn, the report predicts that memecoins will continue to be a part of the crypto market for years to come. With the ease of launching memecoins and the importance of engaging content, only a small percentage of memecoins are expected to survive in the long run, following an extreme power law distribution where 99.99% are likely to fail.
In conclusion, while the memecoin sector may be facing challenges, the report suggests that memecoins are here to stay, albeit in a more selective and competitive landscape. As the market evolves, only the strongest and most engaging memecoins are expected to thrive, potentially even earning recognition to the extent of having government agencies named after them.
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Image Credit: Midjourney.