Meme Coins Summer: Trends and Insights

Disappointment in the Market Fueled the Meme Coin Boom

The defining feature of meme coins is their apparent lack of utility and speculative nature. The market’s fascination with meme coins may reflect a hidden disappointment in utility tokens, which, in reality, have proven to be not much different from meme coins: their utility often feels forced, and their price volatility is just as high.

Besides, the decline in returns from airdrop hunting has pushed the market back to its earlier phase—speculative trading of tokens in hopes of explosive price growth.

PumpFun Became One of the Most Successful Crypto Projects Ever

pump.fun wasn’t an anticipated project within the crypto community. Its success only came after its launch. pump.fun consistently ranks among the top 10 projects in terms of revenue, earning an average of around $10 million per month. Moreover, the project has now emerged as a leader in revenue generation, trailing only behind giants like Tether and Circle.

The concept of having no obvious utility proved to be extremely popular. Investments in newly created meme coins have brought back that sense of euphoria to the crypto market, where small investments could multiply significantly without the need to spend a lot of time on activities or research. Unlike utility projects, meme coins enter the market with very low capitalization, making it easier to pump the token and achieve the desired multipliers.

MemePads: A Simple Idea with Fierce Competition

As is typical in the crypto market, competitors offering similar services, sometimes with slight improvements, soon began to emerge. On the Solana blockchain, DegenFund became a competitor to pump.fun, attracting some of its liquidity and audience by offering features like an anti-bot system and Dev Token Lockup.

Other blockchains also joined the battle for meme pads. BNB, TON, Base, and meme pads have been launched on several blockchains, but the most successful was SunPump on the TRON blockchain.

SunPump’s Success Driven by a Mega Whale

The TRON blockchain wasn’t previously known for its prominent meme coins, but it has now become a leader in the meme coin race. SunPump managed to launch SUNDOG, the largest meme coin by market cap on a similar platform, with a capitalization exceeding $250 million. Following that is Tron Bull with a $115 million market cap, and then MICHI, launched on pump.fun. In addition to these two major coins, several dozen others have been launched on SunPump, with many quickly surpassing $10 million in market capitalization.

The likely reason for this success is the support from Justin Sun, who possesses significant media and financial resources that he can deploy swiftly without the need for approval from funds. The other two blockchains traditionally strong in the meme coin space, BNB and Solana, have lost their key media representatives, CZ and Sam Bankman-Fried. Ethereum, due to its high transaction costs, is less suitable for pre-launching meme coins. Moreover, Vitalik Buterin is a less speculative figure compared to Justin Sun, who actively supports the meme boom not only on his X account but also with his capital.

Meme Coins > DeFi

Currently, the success of meme coins has made them the fourth largest category of tokens by total market capitalization, following digital currencies, blockchain platforms, and stablecoins. Excluding Bitcoin’s market cap, meme coins would even surpass the digital currency sector. This success of meme coins reflects not just their appeal but also the lack of promising projects with reasonable valuations in the market, which could absorb the liquidity currently tied up in meme coins and other no-utility projects.

From a fundamental investment perspective, meme coins represent the free-floating liquidity in the crypto market that could be redirected to utility projects as they emerge. The meme coin boom simultaneously reflects a belief in the crypto market as a whole and a disappointment with the utility, valuations, and diversity of current projects in the market.