Meme Coins Crash Hard After Recent ATH Surge
The meme coin market is going through a sharp decline as almost all major coins suffer great price losses. Several coins, which previously looked promising and were close to top 10 and top 20 lists, have been pushed to the edge of the top 100 and even beyond it. Among the coins that are bleeding heavily are PEPE and TRUMP.
Once known for their mega rallies powered by hype social media hype, meme coins are now undergoing a strong reality check, falling under massive sell-offs and facing a big shift in market sentiment. Investors are now overseeing meme coins with serious doubts about the long-term bullish future of those assets.
Meme coin market bleeding heavily
Since the start of the year, meme coins have been rapidly losing market value. The overall market capitalization of this sector has crashed by more than 50% from the peak reached at the end of 2024. PEPE, which made it into headlines after its launch in April 2023 and then quickly gained traction in the market, showing a parabolic rise, is now struggling, falling below key support levels.
After the all-time high of $0.00002825 reached on December 9, 2024, PEPE is down by roughly 75% from that, trading at $0.000006923. This tremendous price crash is triggering panic among investors and is causing huge liquidations.
The largest meme cryptocurrency by market cap, Dogecoin (DOGE), has also been hit with a significant price decline and lost roughly 30% during the past month. Shiba Inu (SHIB) and FLOKI have been moving in downward trends too, as if proving that the meme coin market is not only rather unstable but is also facing big periodical issues which are much more than just occasional sell-offs.
One of the key drivers of this mammoth decline is the unstable investor sentiment. When the meme coin frenzy was at its peak, social media networks, particularly X and Reddit, fueled meme coin price rises heavily thanks to influencers and crypto communities. Together, those two groups pushed certain meme coins higher, often paying little attention to fundamentals. But once the hype died out, speculative interest also followed the way of the dodo, causing a sharp decline not only in prices but in trading volumes as well.
Large investors, also known as “whales”, have also made a large contribution to the market bloodbath. Recently, several large PEPE wallets have dumped massive amounts of meme coins, sharply increasing the supply circulating in the market and driving prices down. This triggered many stop-loss orders, driving the prices lower still exponentially. Whale activity has always been a crucial factor in meme coin price performance. In this case, this added to the particularly bearish momentum substantially. Official Trump (TRUMP) meme coin launched by US president this January is also 14% down over the past week alone.
Possible reasons behind the market crash
Several reasons likely stand behind the current highly negative situation in the meme coin market. The first one seems the most obvious – market saturation. Unlike the early days of crypto, when only a few meme coins existed thanks to Dogecoin’s launch in 2013, these days, while many chains provide opportunities to launch them even without creating an original code, the market is flooded with meme cryptocurrencies. However, the majority of those projects lack not only any utility but also innovation – they are simply copies of coins that already exist. This has decreased interest and capital inflows, making it hard for any meme coin to stand out.
The second important driver is the impact produced by Bitcoin on all altcoins, including meme cryptocurrencies. Bitcoin, as well as Ethereum, have undergone major corrections as a result of increased volatility lately, and this hit meme coins hard – they are in the category of risky assets, and when the market takes a bearish turn, they are the first to start bleeding.
Besides, due to the overall market correction, many retail investors have been exiting meme coins after suffering big losses on them. Aside from that, meme coins have been struck by the heavy decline of hype on social media platforms with a lack of new projects that would go viral, attracting new supporters and holders. One of the most influential figures in the world of finance, the CEO of Ark Invest, Cathie Wood, has recently stated that she does not believe in the long-term potential of meme coins. Among all crypto, she prefers only Bitcoin for long-term bets.
Overall, even though the current situation does not look good for meme coins, in the future, the market may experience a bullish reversal as it has done many times in the past already. It is just necessary to see renewed retail interest, favorable crypto market conditions, and real-world utility added to new meme coin projects.
Meme coin that came from suicide
Arnold Haro, an amateur retail investor, played Russian roulette with a Smith & Wesson revolver in front of his smartphone camera on February 21. During the livestream, he said that if he died, he asked his followers on X to “turn this into a meme coin.” He was an unlucky investor who kept putting his money into various dubious projects, getting rug pulled afterwards. He also borrowed a significant sum to buy into TRUMP when it surged, but then the meme coin quickly went down in price.
About three hours later, he lost the Russian roulette he was playing, shooting himself in the head. A crypto token named after him was issued after that and it soared to more than $2 million in market cap before it crashed heavily. That was followed by a wave of copycat meme coins emerging quickly as the community tried to capitalize on Haro’s suicide.
This case just underscored the absence of any boundaries in the meme coin world where literary anything can be turned into a meme token, even a tragedy.
