Is the Meme Coin Frenzy Truly Over? Not Quite, Says Kaiko Research
Meme coins are the fun and humorous cryptocurrency that swept the internet and have already set a tough start this year. according to Recent kaiko reportmost meme tokens are struggling, and the losses range from 10% to 70% since the beginning of the year. But does that mean the meme coin mania is over? Not exactly.
Meme coins face ups and downs
Kaiko’s recent report highlights that while popular meme tags like Dogecoin, Shiba Inu and Newer Coins have dropped significantly this year, their popularity has not completely disappeared.
Last year, these tokens outperformed many other cryptocurrencies due to their hype and the opportunity to make quick profits.
This year, despite volatility, the recent surge in new meme coins rolling out, especially on Solana, proves that traders continue to interact with these assets, betting on the next viral success.
Communication and market makers profit from members
One of the reasons Meme coins continue to grow is because they can be used for communications and market makers. The gap between buying and selling prices of meme coins is much higher than that of larger cryptocurrencies such as Solana (Sol) and Ripple (XRP). This allows market makers to earn more from these transactions.
As Meme Coin transactions bring millions of dollars in fees, the exchange has also taken advantage of it, and Centralized Exchanges (CEXS) has been adding them at a faster pace since 2020.
While US platforms like Coinbase list meme tokens slower than offshore exchanges, they are catching up. Some meme tokens, such as Pnut, Trump and Melania, landed on major exchanges such as Binance and Coinbase in a few days, largely due to their hype-driven appeal and connections to outstanding people.
Liquidity and volatility challenges
Kaiko’s analysis warns that the rapid listing of Meme Coins comes with its own challenges. These tokens often experience a large amount of transaction volume, far exceeding their available liquidity, especially at release.
For example, despite limited liquidity, Trump tokens traded $16 billion in daily sales on January 20. This mismatch between quantity and liquidity could lead to extreme price fluctuations, forcing market makers to expand bid differences to manage risk.
Ultimately, this brings costs to traders, making Meme coins a high-risk, high-return investment.
What’s next for Meme coins?
Even though Meme Coin Hype has slowed down this year, it’s far from over. Their mix of humor, community-driven support and speculative appeal continues to attract investors.
As communication adjusts its inventory strategy from “allow list” to “block list” to better manage new token meme coins, it may remain a key part of the crypto world.
