The memecoin frenzy on Pump.fun is hitting a wall

“Graduation rate” is the memecoin launchpad's term for tokens that make it through the incubation phase and become fully tradable

The memecoin frenzy on Pump.fun is apparently hitting a wall, with the platform’s “graduation rate” sinking below 1% for a fourth straight week.

“Graduation rate” is the memecoin launchpad’s term for tokens that make it through the incubation phase and become fully tradable on a Solana decentralized exchange (DEX). To graduate, a token must meet specific liquidity and trading requirements.

Over the past four weeks, starting Feb. 17, Pump.fun’s graduation rate has remained below 1% for the first time, according to Dune Analytics data.

Pump.fun's tanking token success rate. Source: Dune Analytics

Pump.fun’s graduation rate has never been particularly high. The platform’s best-performing week was in November 2024 when 1.67% of memecoins moved on to the open market.

However, the sheer volume of tokens launched on the platform at the time made this percentage more significant than it is now. During the week starting Nov. 11, 323,000 tokens were created on Pump.fun, meaning the 1.67% graduation rate translated to roughly 5,400 tokens entering Solana’s DeFi economy in a single week.

Related: Pump.fun's memecoin freak show may result in criminal charges: Expert

With token creation volume declining on both Pump.fun and Solana, weekly token graduations have plummeted to a four-week average of around 1,500 tokens at the time of writing, according to Dune.

Memecoins are dying, and they’re not responding to positive market signals

Pump.fun’s dropping graduation rate reflects waning investor appetite for memecoins, which have developed a reputation as degenerate lottery tickets or quick cash grabs for their creators.

Several political figures have launched their own memecoins as well, including US President Donald Trump. His token is down 84% from its all-time high set on Jan. 19, according to CoinGecko.

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Memecoins’ struggles persist despite improving liquidity, according to Matrixport. In February, Matrixport analysts noted that a strengthening US dollar had pressured Bitcoin prices by tightening dollar-denominated liquidity.

Since then, the US dollar has weakened. Over the past month, the US Dollar Index (DXY), which measures the dollar against a basket of major currencies, peaked at 107.61 on Feb. 28 before dropping to 103.95 on March 14.

DXY performance in the past month shows the US dollar weakening. Source: TradingView

“The US dollar has recently weakened, leading to a rebound in liquidity indicators and some marginal improvements in inflation data. Despite these positive shifts, memecoins — previously one of the strongest narratives during this bull market — continue to struggle significantly, with no apparent recovery,” Matrixport said in its report.

Bitcoin caught in memecoins' aftershocks

The struggling memecoin market has contributed to a $1 trillion wipeout in crypto market capitalization, according to Matrixport.

“This redistribution of wealth may lead investors to remain cautious about deploying further capital, causing rebounds — even those triggered by better-than-expected inflation data — to be limited,” the report noted.

Matrixport analysts warn that this could lead to further Bitcoin declines, with a potential retracement to as low as $73,000 — a level they believe would provide “strong support.”