If you’ve put your ear close to the cryptocurrency ground over the past few years, chances are you’ve heard the sound of a dead horse being mercilessly flogged. That horse in question is the beloved meme coin, which — despite 99% of its cohort having zero inherent worth — has been propped up, made-up, and ghoulishly paraded around as the next best thing for the past few years.
What started as a fun, irreverent way to engage with blockchain technology quickly turned into an unstoppable hype machine, with countless launches that left no stone unturned for source material to adapt and no copyright left uninfringed. At their peak, meme coins created millionaires almost overnight and embodied the idea that the cryptoverse could be as much about entertainment as finance.
Unfortunately, (or fortunately, depending on your experience), the spell of meme coins is finally beginning to wear off. First, most don’t realize that the meme coin sector is beyond saturated, and value is not distributed evenly, with the top three coins, Dogecoin, Shiba Inu, and Pepe, accounting for a staggering 67% of the total memecoin market. The rest are almost always pump and dumps with a shelflife of a spotty banana.
Now, of course, naysayers have always maintained that meme coins are dying, but this time they might actually be right. This collapse isn’t just the typical boom-and-bust cycle, but rather a fundamental rejection of meme coins as a viable investment class. Instead, we are seeing the rise of utility-based projects again, with many subsectors such as decentralized science (DeSci) getting the spotlight cast in its direction once again. But why is this happening?
The Fall of Memecoins
For most of their history, meme coins have followed a more predictable routine than an OCD-riddled body builder. First, a new token would emerge, often with a name or topic so absurd you could see your own brain from hard-rolling your eyes. It would quickly gather a community, and experience a meteoric rise as more investors FOMO-ed in. Then, inevitably, the hypetrain would slow, liquidity would dry up, and early adopters would cash out, leaving some latecomers holding the bag. Brutal, but there was an inherent logic to it and always an undercurrent of optimism. After all, as long as new memes kept emerging, there was always another chance to ride the wave.
That optimism has faded.
Solana is perhaps one of the biggest culprits for the death of the meme coin craze. Once a haven for NFT creation, the chain has since become the most prolific meme coin chain, and not in a good way. Questionable platforms like Pump.fun and Moonshot made it easier than ever for anyone to create a new meme coin on the network, leading to an explosion of low-quality, rug-pull-heavy memecoins that do not qualify as common financial instruments. This flood of scams and low-effort tokens has led to widespread fatigue; where once the promise of “just one more pump” was enough to keep people engaged, now many are simply walking away. With so many memecoins barely disguising the fact that they are outright scams, the fun is gone.
The SEC’s Division of Corporation Finance has also clarified that most meme coins are not considered securities under federal laws. This guidance primarily discusses their speculative nature and the lack of functional worth or investor protection over these cryptocurrencies. This guidance has allowed exchanges to list more meme coins without fear of regulatory repercussions, responding to the increasing demand and speculation around these cryptocurrencies.
Another big nail in the memecoin coffin were the recent black swan events. The sector had to suffer not one, or even two, but three eye-wateringly bad situations almost back-to-back in less than a single month. Firstly, for some baffling reason that many speculate smelled a lot like the machinations of Barron Trump, President Donald Trump released a memecoin that no one wanted or asked for, trampling other projects in the process as investors scrambled to profit from what was seen as a once-in-a-lifetime opportunity.
Except that it wasn’t a one-off, at all: The very next day his wife Melania Trump released her own painfully cringe memecoin. What began as a strange but fun release very quickly soured into widespread skepticism and ridicule of the pair as insiders sold off, tanking the price of both coins. The whole thing was very strange, leaving many scratching their heads.
After all, you essentially had the President of the United States and the First Lady slow-rugging an entire global population with no recourse, highlighting that politics and crypto are a very bad mix. The majority of memecoins launched in the past year have been on American platforms, underscoring the regulatory landscape’s role in fostering innovation while drawing attention to meme coins and their associated risks.
If that wasn’t bad enough, just over three weeks later popular Argentinian President Javier Milei officially promoted a memecoin called $LIBRA, sending it skyrocketing to a $4.5 billion market cap, only to have it crash all the way back down to low millions after suspiciously large holders sold off and made fortunes. This event — now commonly referred to as Cryptogate — is regarded as one of the most high profile rugpulls ever, and is so serious that the Department of Justice (DOJ) has apparently opened an investigation into everyone involved, including the president himself.
Indeed, the $LIBRA scandal’s devastating effect on memecoins has echoed through space. Pratik Kala, head of Apollo Crypto, said, “After the Milei incident, I think the meme coin mania is dead for the foreseeable future, [not because of the failure of the token itself] but because of how rigged the game is, and the blatant insider sniping and trading that occurs under federal securities laws.”
Ouch. Meme coins do not qualify as securities since they do not generate a yield or convey rights to future income, profits, or business assets.
What Are Memecoins?
Memecoins are a quirky subset of cryptocurrency that have their roots firmly planted in internet memes, characters, and trends. Think of them as the class clowns of the crypto world — volatile, unpredictable, and often more about the humor than serious financial strategy. These meme coins are typically backed by enthusiastic online communities who revel in the absurdity of it all.
Unlike traditional cryptocurrencies, such as Bitcoin, that aim to solve real-world problems, meme coins are more about entertainment and high-risk, high-reward trading. Classic examples include Dogecoin, which started as an Elon Musk joke but gained a cult following, and Shiba Inu, another canine-themed coin that rode the wave. While they might not offer much in terms of usability, they represent a substantial portion of the total meme coin market cap, illustrating their fluctuating worth and community interest.
The Rise and Fall of Memecoins
Memecoins have experienced a meteoric rise in popularity over the past few years, capturing the imagination of the crypto community and beyond. Their appeal lies in their entertainment value, community-driven nature, and the tantalizing potential of high returns for investing. These digital assets, typically inspired by internet memes and trends, have amassed substantial market cap, making headlines and drawing in a diverse array of meme coin purchasers.
The rise of memecoins can be largely attributed to their whimsical charm and the fervent online communities that rally behind them. Platforms like Solana have made it easier than ever to create and trade these coins, leading to a proliferation of new memecoins. However, this ease of creation has also contributed to their downfall. The vast majority of memecoins are highly speculative, lacking any underlying assets or revenue streams to support their value. This makes them incredibly volatile, with prices that can skyrocket one day and plummet the next, leaving investors with substantial losses.
Despite their speculative nature, the Securities and Exchange Commission (SEC) has clarified that most meme coins are not considered securities under U.S. federal law. While this provides some regulatory clarity, it does not mean that investing is risk-free. The crypto community has long demanded more regulatory certainty, and while the SEC’s guidance is a step in the right direction (as answering the securities question was a big deal), the regulatory landscape is still evolving.
Memecoins have become an integral part of internet culture, often created and traded by individuals and small groups rather than large corporations. This grassroots approach has led to the creation of new decentralized exchanges, making it easier for people to buy and sell these assets. However, the rise and fall of most meme coins also pose significant risks and challenges, which we will explore in the next section.
Characteristics of Memecoins
Memecoins are a unique breed in the cryptocurrency zoo, relying on blockchain technology to exist and thrive. Picture animated characters or animal memes — these are the faces of most memecoins. Unlike utility tokens that serve specific functions within a blockchain ecosystem, memecoins are often generated with no other purpose than to be traded and converted. They are the shiny, collectible trading cards of the crypto world, drawing in traders with their whimsical appeal.
Despite their lack of practical use, memecoins have become incredibly popular on decentralized exchanges, where they are traded with fervor. Daily trading volumes for these tokens can exceed $6 billion, a testament to their allure. While some centralized exchanges also list the more popular memecoins, it’s the decentralized platforms where they truly shine, offering a playground for traders looking to capitalize on the next big meme.
Market Capitalization and Valuation
Market cap is the yardstick by which the size and value of a cryptocurrency are measured. For memecoins, this metric is particularly telling. Websites like CoinMarketCap track the market cap of various cryptocurrencies, including memecoins, providing a snapshot of their current standing in the crypto market. The top meme tokens by market capitalization are listed and regularly updated, reflecting the ever-changing landscape of digital assets.
Memecoins have gained significant visibility due to their potential for high returns and their prominent role in digital culture. However, this visibility comes with a caveat: extreme volatility. Prices of memecoins can skyrocket or plummet in the blink of an eye, making them a rollercoaster ride for investors. While the allure of quick gains is strong, the risk of dramatic losses is equally high, underscoring the unpredictable nature of most meme coins.
Risks and Challenges
One of the most significant risks associated with memecoins is their high volatility. The value of these tokens can fluctuate wildly, resulting in substantial losses for investors who are not prepared for the rollercoaster ride. The lack of underlying assets or revenue streams backing memecoins makes them highly speculative investments, and unlike Bitcoin and other popular cryptocurrencies, their prices can change rapidly based on sentiment and hype.
The SEC’s guidance on memecoins does not provide protection for investors, and federal securities laws safeguard neither memecoin purchasers nor holders. This lack of regulatory clarity can make it challenging for investors to navigate the cryptosphere, which is largely unregulated. The decentralized nature of memecoins means they are often created and traded on platforms where tracking ownership and worth can be difficult.
The vast majority of memecoins are not listed on centralized exchanges, limiting their liquidity and making it challenging to buy and sell them. This can be particularly problematic during downturns when investors may struggle to exit their positions. Additionally, the crypto community is often referred to as a “boy’s club,” with a lack of diversity and inclusivity that can make it difficult for new investors to enter the market.
The rise of memecoins has also led to an increase in scams and fraudulent activities. The lack of transparency and accountability in the crypto market can make it challenging for investors to conduct their own research and make informed decisions. Despite these risks and challenges, memecoins continue to be a popular investment option. It is essential for investors to be aware of the potential pitfalls and to approach these investments with caution, conducting thorough research before diving in.
The Return to Real Utility
With meme coins dropping off harder than Hayley Welch’s career, investors are looking for somewhere they can reliably put their finances into — and get more than an hour’s restful sleep in the process. Just as top crypto influencer Altcoin Gordon recently wrote on X, “meme coins are dead, people are coming back to utility.” Indeed, many are seeing a new wave of strong utility-driven projects offering far more than baseless speculation.
One of the clearest signs of this shift is the resurgence of decentralised science (DeSci) projects, which were a big hit throughout 2024 and typify real-world utility in its purest form. Unlike memecoins — which rely entirely on hype — these projects leverage blockchain technology to support independent researchers and solve genuine real-world problems, while removing biased profit-driven intermediaries in the process.
Popular projects such as Bio Protocol, AxonDAO, and ResearchHub (among many others) are quietly changing lives while memes sit around and do precisely nothing. DeSci projects can drastically change how scientific funding, research, and data sharing operate and remove the traditional barriers imposed by universities, government grants, and corporate interests.
This is not just theoretical stuff either. We are already seeing real-world examples of DeSci making a tangible impact. For example, CerebrumDAO has raised over $1.5 million to support research into neurodegenerative diseases. Collaborating with Fission Pharma, the DAO is investigating mitochondrial dysfunction as a potential therapeutic target for conditions like Alzheimer’s disease.
In addition, AxonDAO developed patient-centered applications and worked closely with leading clinical data providers during the COVID-19 pandemic and continues to drive innovation in leading medical research. These projects are a tiny fraction of many thriving DeSCi projects and exemplify how the sector can go well beyond theory, producing tangible results that reshape the scientific landscape — and doing a lot more for humanity than a dog in a suit can … probably.
A New Digital Horizon in Internet Culture
Cryptocurrencies has always been cyclical, but this time, the shift away from memecoins feels different — a sort of final march to the sound of a death knell (which probably resembles the Crazy Frog soundtrack). Humor can work for so long. Too many people have been burned, and too many meme coins have collapsed under the weight of their own emptiness.
It’s time for crypto to pivot or die.
And it is already doing so, with utility being the oasis in the desert of scams and bad actors. Sectors like DeSci are proving that crypto can be more than just a degenerate playground. Investors who once poured money into meme coins in hopes of quick gains are finally beginning to see the potential and stability in backing projects with long-term sustainability. In a nutshell, crypto is growing up, and the future belongs to projects that actually build something.
Just don’t tell the moonboys, or they’ll cry in their leased BMWs.
