Memecoin falls into a winter: dominance drops back to 2022 "zombie" levels

Once upon a time, memecoins led by Dogecoin and Shiba Inu created brilliant moments at the end of 2024. These charismatic digital assets rode the wave of retail enthusiasm, with market capitalization soaring to an exaggerated level of 100-120 billion USD. Meme coins in the Solana ecosystem, AI-themed tokens, and politically themed currencies took turns creating “get-rich-quick” myths, and the entire ecosystem soared like a rocket.

However, as we entered 2025, market sentiment rapidly reversed. A deep correction is swallowing this seemingly prosperous territory.

The Harsh Reality Revealed by Data

According to tracking data from CryptoQuant and CoinGecko, memecoin dominance among altcoins has sharply declined from 0.11 at the end of last year to 0.04 now, a level comparable to the downturn at the end of 2022. From another perspective, this means memecoin market appeal evaporated by 64% in just three months.

CryptoQuant CEO Ki Young Ju bluntly stated on social media: “The memecoin market is dead.” This is not a pessimistic cry from a retail investor but a calm judgment from a data analysis platform manager. What's behind it? A series of ugly on-chain indicators and trading volume data.

How are mainstream memecoins performing in the current market? Take DOGE as an example; its current market share is only 0.68%. WIF (dogwifhat) hovers at a very low level of 0.011%. These once-glamorous assets have now become marginal players in the market.

Liquidity Evaporation and the Failure of Rotation Mechanisms

Even more worrying is the phenomenon: liquidity is collectively disappearing.

In a normal cycle of rotation markets, a weakening in a specific niche usually triggers capital to flow into new concepts—retail investors shift from out-of-favor coins to emerging hot spots, creating a relay-style rally. But now? This rotation has completely stalled.

Dog-themed coins (DOGE, SHIB, WIF, etc.), Solana ecosystem meme coins, AI concept tokens, and various themed coins all collapsed simultaneously like out-of-control dominoes. Even more bizarre, even though the total market cap of the entire altcoin market remains relatively stable, memecoin decline continues. What does this indicate? It suggests that funds are not simply shifting between memecoins but are actually fleeing this sector altogether.

CoinGecko's detailed data confirms this judgment: all mainstream meme series tokens have hit their lows since mid-2023, with no signs of rebound. The lack of liquidity, like a black hole, swallows up buy orders. Highly volatile assets are usually the first to be sold off, and memecoins are a typical example of these “high beta” tools.

Structural Decline vs. Short-term Correction

Some analysts believe this correction is just a temporary breather, and history will repeat itself with memecoin revival.

But the evidence points in another direction. Past corrections were often accompanied by a clear “next story,” with new hype themes attracting retail investors en masse. And now? Silence. No new concepts stirring ripples, no new hot topics taking over, and no signs of retail funds re-entering.

The synchronized disappearance of liquidity and the overall contraction of trading volume indicate that this is not just an ordinary technical correction but a structural confidence crisis. Unless there is a qualitative change—such as new funds pouring in or a fundamental shift in market narrative—memecoins may remain in a prolonged low phase.

Currently, the memecoin market is in a “glacial period” similar to late 2022. That period was characterized by: capital exhaustion, fading enthusiasm, and light trading. History often repeats itself, but this time, the recovery may take much longer than we imagine.

Prepare yourself for a cold season.