Author: Arain, ChainCatcher
The summer of Memes is being declared over.
From the collapse of the Trump family's $TRUMP to the exposure of the $Libra scam endorsed by the Argentine president, Solana, which viewed Memes as the core driving force of on-chain transactions, has seen its on-chain trading volume halved and the number of new tokens issued daily reduced by 70%. Major Meme coins have dropped over 70% since the beginning of the year… Various signs indicate that the nearly $60 billion total market cap bubble of Memes is beginning to show cracks.
Matt Hougan, Chief Investment Officer of Bitwise, Haseeb Qureshi, Managing Partner at Dragonfly, and Nic Carter, Partner at Castle Island Ventures, among other investors, have recently expressed bearish views on the future of Memes.
"I still can't lie flat; I have to do something," Philo said in an interview with ChainCatcher. Philo, who calls himself a "P Junior," recently publicly stated that he successfully exited by liquidating all his Meme assets. However, during the time he should have been lying flat, he couldn't. Philo told ChainCatcher reporters that he has decided to start a business to create a platform for shorting Memecoins.
This decision means Philo is stepping away from the identity of "P Junior" and achieving a transformation. Philo's transformation is a microcosm of the countless P Juniors facing a sudden cooling in the Memecoin market.
Meme Coins Encounter "Waterloo": P Juniors at a Crossroads
According to Google Trends, the global search interest in "Memecoin" peaked in January and then plummeted by nearly 60% by the end of February. Coingecko statistics show that the overall decline in the Meme sector over the past seven days ranks among the worst-performing Top 10 assets in the entire crypto market 📄, with well-known Memes like TRUMP and MELANIA dropping over 70% since the beginning of the year. Even blue-chip Meme coins like DOGE and SHIB have recorded negative returns.
The secondary market for Memes is performing poorly, and on-chain activity has also entered a slump. Dune Analytics shows that the daily trading volume of the Meme coin issuance platform pump.fun dropped sharply from $390 million on January 24 to $134 million in February, a decline of 64.83%; the number of new tokens issued daily fell from 61,800 to less than 30,000, a reduction of over 50%.
In the face of the Memes retreating phenomenon, Bitwise Chief Investment Officer Matt Hougan publicly stated: "… Over the past year, Memecoins have been the hottest sector in the cryptocurrency space outside of Bitcoin. Removing Memecoin activity from the crypto ecosystem will have an impact, and that is what you are seeing today."
Philo was once a P Junior in the recent wave of Memecoin wealth creation, choosing to withdraw at this point. But few could imagine that this young person who seized the Meme opportunity is only in his fourth year of college. Due to his obsession with studying cryptocurrencies, he "voluntarily" gave up his studies—he recently received a notice of expulsion.
"I spent most of my time not in school, so I received the expulsion notice. I went to college mainly to find a job in the future, but my actual experience tells me that achieving the goal of making money in the crypto space is easier—you might earn in one year what many people take decades or even a lifetime to earn," Philo told ChainCatcher reporters.
Philo's experience is full of drama; as a civil engineering student, he self-taught programming out of interest. In fact, during the past few cycles, Philo candidly stated that he seized opportunities in DeFi and NFTs, and he was most satisfied with making money using his GitHub account, which made him realize "this is a cost-free but highly profitable endeavor." Thus, he ventured further down the path of programming and cryptocurrencies, claiming to have won several hackathon awards.
However, this time, the gold mine he struck in the Memecoin wave made him feel he could take a break.
Why choose to step away from the identity of P Junior at this time? Philo said it was intuition that told him to do so, "I have investment and entrepreneurial experience, and my experiences tell me that whether in investment or entrepreneurship, it's not just about skills and vision; luck also plays a significant role."
Stepping away from the identity of P Junior brought Philo a period of peace in his life, "Comfort, happiness, and security have all increased." But after less than half a month of rest, Philo couldn't sit still. He turned his attention to entrepreneurship, stating that he is developing two projects: one is a Bitcoin stablecoin, and the other is a platform for shorting Memecoins. "I think shorting Memecoins is an opportunity. There are many platforms in the market that help Memecoin bulls make money, but there is a lack of opportunities for bears to profit. For me, entrepreneurship is more about whether it is something I want to do and its positive impact on the industry, rather than profit. Even if I lose in entrepreneurship, it can still benefit the market."
Some P Juniors choose to exit at this time, but others choose to hold their ground and upgrade to P Marshals. Meme coin KOL @YuYue stated in an interview with ChainCatcher that her life hasn't changed much, "But I will focus more on life, explore more new projects, and make friends. In the future market, I will still actively pay attention to the Meme track and various emerging on-chain Alphas because this form of asset issuance has transcended the cultural concept of Meme, so I remain optimistic about the future of on-chain assets and on-chain Memes continuing to have more opportunities, and I will act when the time is right."
Davis Double Kill Crisis: Bubble Burst and Solana Sell-off
P Juniors are at a crossroads, making different choices related to their judgments about the future.
Although data shows that Memecoins are starting to cool down, Yuyue does not believe the story of the Meme track has ended.
"I think this change is a natural phenomenon, but it means a 'tide retreat' or the end of the track. In fact, the entire Meme craze has lasted for over a year, starting with Memes like WIF and BOME, and this cycle and vitality have far exceeded all other sub-tracks, so it's normal for the entire Meme track to fall into an emotional low," she stated in the interview.
Recently, the out-of-circle effect of Memecoins has mainly relied on celebrity coins. Celebrity coins often have a certain fan base and stronger topicality, making them more likely to go viral. However, this has also led to criticism. The explosive popularity of Memes due to celebrity coins has also led to their downfall. Events like the collapse of the Trump family's TRUMP and the Libra scam have accelerated the market's loss of confidence in Memecoins.
Loopify, founder of Treeverse, publicly stated: "Memecoins are like NFTs from the last bull market; when the tide goes out, only the bubble remains." Taking the TRUMP token as an example, its market cap once soared to $70 billion, but after the truth of its lack of real use cases was exposed, the price quickly went to zero.
In this wave of celebrity Memecoins, Memes seem to have begun to lose their original intent. Initially, retail investors were keen on Memes partly to counter VC Coins, but today, retail investors have become the injured party.
Haseeb Qureshi, Managing Partner at Dragonfly, stated in a recent podcast: "People seem to realize the nature of Meme promoters and how these large-scale Meme coin issuances are detrimental to retail investors… People have begun to question how Memecoins operate, and it has become less certain whether retail investors can continue to participate in this so-called 'casino.'"
A leader of a Memecoin research community told ChainCatcher: "New retail investors have basically been wiped out."
In addition to the bubble of Memes beginning to dissipate, the market is gradually shifting towards more conservative asset attributes, putting Memecoins in a situation similar to a "Davis double kill." Since January 2025, net inflows into Bitcoin ETFs have reached $43 billion, while Solana, the main battleground for Memecoins, has seen outflows exceeding $12 billion during the same period. Additionally, Solana faces the pressure of unlocking 11.2 million SOL on March 1, which were sold at a low price to institutions as part of FTX's bankruptcy liquidation, costing only 30%-40% of the market price. The market fears that the unlocking will trigger a sell-off, and the decline in Solana's price will further drag down the prices of the Memes that rely on it as their main battleground.
However, YuYue pointed out to ChainCatcher, "In fact, the overall environment in other sectors, including various public chain ecosystems, DeFi, etc., is not so optimistic. The core reason for the sluggish market is still liquidity, which is a problem faced by all sectors and ecosystems in the crypto space."
The Second Half for Meme Players: Either Roll or Transition
Where should Meme players go in the second half?
On February 19, during Consensus HK, a roundtable discussion on "Trends and Rhythms of the New Web3 Cycle" was held by RootData and ChainCatcher, featuring Kyle, Partner at Cooking.city & Co-founder of EVG, investor 0xbing, crypto KOL YuYue, Vand Ni, founder of Asian on chain, and Leo Li, Web3 Product Manager at OKX, discussing the theme of "The Advancement Path of Memes and P Juniors."
One consensus is that the second half of Memes will be a more competitive and challenging PVP battlefield. YuYue believes that Memes may have a longer lifespan than most narratives and will force the market to rethink the valuation system. The second half will be a more brutal PVP battlefield where everyone needs to find their positioning, while Leo Li believes it is necessary to reduce trading frequency, as high-frequency PVP poses too great a challenge for many ordinary players.
Meme has also spawned some other gameplay. For example, Time.fun, which tokenizes "time," Monsters.fun, which integrates AI agents with game economics, and Nad.fun, which introduces anti-MEV mechanisms and social points airdrops, continue to join the exploration of Meme 2.0.
However, it may be like the narratives that once flourished in the market; after DeFi Summer, there was no DeFi 2.0, and after the winter of the inscription market, there was no inscription 2.0. The new narratives captured by the market may open up in other places.
Moreover, there is more than just Memes and celebrity coins on-chain. According to Dune data, since the beginning of the year, the narratives of Derivatives, FriendTech, and RWA have begun to outperform the market.
The three narratives point to the rhythm of institutional capital entering the market.
Among them, RWA, as a trillion-dollar sector under the wave of compliance, has already attracted large institutions to enter over the past year. DefiLlama data shows that the RWA sector's TVL (Total Value Locked) is expected to exceed $80 billion in Q1 2025, a year-on-year increase of 300%. Traditional institutions like BlackRock and Fidelity have entered the market, and the stablecoin bill promoted by the U.S. Congress will further drive the compliance process.
The DeFi market has begun to show signs of recovery since the beginning of this year. According to a report by Messari, although the trading volume and total locked value (TVL) of the DeFi market are expected to decline in 2024, liquidity remains strong at the beginning of 2025, demonstrating the market's resilience. For example, Plume Network attracted over $4.5 billion in asset commitments before its launch, with a TVL of $64 million; Uniswap V3 continued to lead the DEX market in trading volume at the beginning of 2025, capturing over 40% of the market share; the TVL of lending platforms like Aave and Compound also rebounded at the beginning of 2025, especially Aave's expansion on Polygon increased its TVL from $6 billion to $12 billion.
Notably, Coinbase's launch of a BTC-collateralized loan product has attracted more mainstream users into the DeFi space. Additionally, the integration of RWA is also seen as an important growth point for the DeFi market, such as Tradable's collaboration with ZKsync to bring $1.7 billion in credit assets on-chain.
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