The cryptocurrency market has seen a significant drop in the deployment of meme tokens on Pump.fun, with Bitcoin attracting a majority of the market’s liquidity. The overall cryptocurrency market has declined by approximately 22% since reaching its peak earlier in the year, with total market capitalization falling to $2.85 trillion. This decrease in market value is indicative of growing bearish sentiment, as previously high-performing sectors have seen declines. Memecoins, which have been a significant contributor to the overall crypto market capitalization, have also mirrored this trend, experiencing a slowdown in performance.
One example of this slowdown is the presidential memecoin token Official Trump [TRUMP], which saw a massive rally to over $1 billion in market cap before plunging by 83%. Other memecoins, such as Official Melania Meme [MELANIA], have followed a similar trajectory. Despite these declines, the memecoin sector still holds a market cap of $53.04 billion, showing a slight increase over the past 30 days. However, platforms like Pump.fun, which facilitated the rapid deployment of memecoins, have seen a significant decline in activity, contributing to the sector’s weak performance.
Daily token deployments on Pump.fun have dropped by 56.3%, and the graduation rate of tokens to broader markets has fallen from 1.4% to 0.7% in the past month. This decline in activity on Pump.fun has been exacerbated by the launch of LIBRA, promoted by the Argentine president, Javier Milei, which experienced a significant rug pull shortly after its release. As investor focus shifts towards Bitcoin amid the broader market struggles and declining liquidity in the memecoin sector, Bitcoin has become the primary magnet for market liquidity.
Bitcoin’s market dominance has increased to 59.1%, showcasing its growing share of the total crypto market value relative to altcoins. In contrast, memecoin dominance has declined to 1.83%, indicating a shift in market preference away from meme tokens. With less liquidity flowing into the memecoin sector, most tokens in this category are expected to underperform, except for a few that react to specific market events. For example, TRUMP surged 75% in the past day, showcasing the potential for sporadic gains in the memecoin sector amidst overall declines in activity and performance.
