The Memecoin Market Has Crashed. What Happened?

Since Donald Trump took office, instead of a rally, memecoins have haemorrhaged $46 billion in market value.

The memecoin market, once red-hot, is now showing deep signs of decline.

Since Donald Trump took office, memecoins have haemorrhaged $46 billion in market value — instead of rallying.

The collapse coincides with the First Family's decision to launch both a Trump and a Melania memecoin amid the publicity of their return to the White House.

“During the inauguration, Trump and Melania dominated the market, accounting for 67.8% of the total memecoin trading volume,” Illia Otychenko, lead analyst at crypto exchange CEX.io, told DL News.

“Their surge was partially fuelled by capital rotation from other memecoins like Doge and Pepe.”

While instantly popular, their fame was short-lived as early investors cashed out millions leaving later buyers with significant losses.

The Trump memecoin is now down 75% from its peak, wiping out $11 billion in the process. Melania's token has declined even further, with a 90% slump from its all-time high.

Even freshly created tokens from memecoin generators like pump.fun are failing to garner hyped interest from investors.

Memecoins have only declined since Trump's inauguration. Photo: CoinMarketCap.

On Thursday, data reviewed by DL News showed that only three tokens that graduated on pump.fun, by reaching the $89,000 market value threshold, managed to go on and rise to $1 million in market value — compared to scores of memecoins that attained this milestone only a few weeks ago.

Memecoin trading activity has also slumped with the sector's volume down 20% in the last month.

While the memecoin downturn is part of the broader crypto market slump, analysts cite the oversaturation of meme tokens as a contributing factor to the decline.

“The market is recalibrating [and] we are seeing a vibe shift that feels a lot like 2020 and 2021, with technically innovating projects dominating conversations,” Alvin Kan, chief operating officer of Bitget Wallet, told DL News.

Despite the market rout, the pace of memecoin creation remains relentless.

Pump.fun alone accounts for 50,000 new meme token launches each day, according to data from Dune.

But still, market observers say memecoins are far from done.

Kan says that memecoins could experience a short-term bounce this month but a more sustained rally is likely to coincide with the next crypto bull cycle later this year or in 2026.

But memecoins are often triggered by broader market trends. Memecoins, like the rest of the market, are waiting on the sector's leader, Bitcoin, said Otychenko.

Bitcoin traded at $98,000 on Friday and is down 10% from its all-time high of $108,786 on January 20, Trump’s inauguration day.

Osato Avan-Nomayo is our Nigeria-based DeFi correspondent. He covers DeFi and tech. Got a tip? Please contact him at osato@dlnews.com