Memecoin market cold period: liquidity exhaustion, market participants should exercise caution in selection

From Peak to Winter: Data Witnesses a Brutal Decline

Do you remember the grand feast at the end of 2024? Led by Dogecoin (DOGE) and Shiba Inu (SHIBA), the Memecoin army, along with newcomers like WIF (dogwifhat), once sparked endless imagination among retail investors. At that time, the market was in full swing, with various themed Meme coins—ranging from Elon-inspired tokens, Solana ecosystem stars, to AI variants—competing to perform “rocket launches.” The entire Memecoin sector’s market cap once ballooned to $10-12 billion.

However, this prosperity was like a fleeting flower.

According to the latest data from CryptoQuant and CoinGecko, everything has changed dramatically. Memecoin’s dominance in the entire Altcoin market dropped from 0.11 at the end of 2024 to the current 0.04—directly back to the “zombie level” at the end of 2022. This is not a minor adjustment but a thorough market revaluation.

Liquidity Exodus: Market Participants Retreat Collectively

Digging deeper into the root of this crisis, we find the problem lies in liquidity.

The current Memecoin ecosystem has formed an insurmountable deadlock: no new funds entering, no new narratives saving the market, and even retail investors have stopped adding to their positions. In previous cycles, when a certain asset class underperformed, funds would automatically flow into the next hot spot—this is known as the “rotation effect.” But now? Only silence.

DOGE’s current circulating market cap is $23.27B, down -1.50% in 24 hours; WIF’s market cap is only $375.00M, down -2.09%. These once-starred coins have now fallen back to mid-2023 levels. Whether it’s the Doge series, Meme coins from the Solana ecosystem, or frog coins and AI-related tokens—they all declined simultaneously, with no sector spared. This “step-by-step” decline pattern itself is a dangerous signal: the market no longer believes in rotation, and liquidity is systematically disappearing.

If investors are to choose investment targets as cautiously as selecting canaries—by observing indicator coins’ performance to assess risk—then the current Memecoin market is precisely a warning that this canary has already fallen.

Market Key Figures Are Also Shaking Their Heads

CryptoQuant CEO Ki Young Ju’s statement on social media is shocking. He succinctly and plainly said: “The Memecoin market is dead”—no embellishments, no hopeful words, just raw reality. This is not just an emotional vent but a judgment supported by comprehensive on-chain data.

From a technical perspective, market sentiment has completely reversed. Liquidity indicators scream signs of contraction, and highly volatile assets are always the first to be wiped out. When market participants vote with their feet, Memecoin is the first to be abandoned.

This Time Might Be Different: Structural Decline Instead of Temporary Low

This is the most worrying part.

Historically, the Memecoin market has experienced multiple dormancy periods, but they were all short-lived. Liquidity drying up would trigger a concentrated sell-off, and then, triggered by some event, new funds would rush in. But current signs suggest this time might really be different.

Vanishing liquidity, ongoing synchronized declines, no new concepts to take over—all point to one conclusion: what the market is experiencing is a structural cool-down, not a short-term adjustment. Unless there are unexpected catalysts or retail investors are reactivated, this winter could be particularly long.

The data itself tells the story’s ending: Memecoin is being marginalized within the entire crypto ecosystem, and the flow of market liquidity has changed direction. When speculative demand recedes, these assets “lacking fundamentals” are the first to be abandoned.

Long-term Low Tide Is Inevitable

When dominant data drops to multi-year lows, recovery becomes exponentially harder. This is not alarmist—it’s the cruel law of liquidity markets.

Memecoin, once the market protagonist, has fallen to a marginal role, reflecting a fundamental shift in market risk appetite. Without liquidity support and without new retail enthusiasm, this once crazy sector can only sleep silently through the winter.

Prepare for a long period of calm. According to CryptoQuant and CoinGecko data, this Memecoin decline is like a fallen canary—it not only signals the sector’s difficulties but also serves as a warning light for the entire market trend shift.

Written by: András Mészáros

Senior analyst in cryptocurrency and Web3, founder of Kriptoworld

Years of focus on blockchain ecosystem reporting, providing in-depth insights into DeFi, tokenomics, altcoins, and crypto regulation, continuously tracking key trends shaping the digital economy.