Meme-Coins in Decline: Why the Speculation Hype Collapses in 2025

The crypto market is experiencing a dramatic sobering. Meme coins are in free fall and have completely given up their spectacular gains from the Christmas period of 2024. With a decline of 65%, the market capitalization of these assets shrank to a mere $35 billion US dollars by December 19, 2024 – a scenario that has shocked many retail investors.

The Investor Confidence Problem

The numbers tell a clear story: the average trading volume in the meme coin sector collapsed by 72% compared to the annual average and fell to $3.05 trillion US dollars, according to CoinMarketCap data. This dramatic decline signals a fundamental shift in sentiment among retail investors, who were once considered the drivers of these volatile assets.

What makes this crash particularly noteworthy? Meme coins have long served as a barometer for risk appetite in the crypto community. Their decline indicates that retail investors are reconsidering their capital allocation and moving away from highly speculative assets – a sign that the bull run was built on a fragmented basis.

The Political Factor and Its Aftermath

The explosive growth of the meme coin sector in 2024 was closely tied to political narratives. The US presidential race fueled a wave of speculative buying, which according to CoinGecko data, led to unprecedented valuations. These high-profile token launches related to political figures marked the peak of a speculative bubble.

But as this political dynamic weakens, the artificial demand also dissolves. The ongoing crypto bear market into 2025 shows: what is driven by external narratives can just as quickly collapse again.

NFTs Follow the Same Fate

Not only meme coins are suffering from the new market dynamics. Non-fungible tokens (NFTs), which were also considered highly speculative segments of the crypto market, experienced a steep decline in December. The market capitalization dropped to $2.5 billion US dollars – the lowest level since early 2025, according to CoinGecko analyses.

Especially noteworthy: the weekly number of sellers fell below 100,000 transactions for the first time since April 2021, as documented by CryptoSlam. This collapse in NFT activity reflects the same dynamics as meme coins – a 72% decline from the January peak of $9.2 billion US dollars.

What Does This Mean for the Next Bull Run?

The current market downturn is symptomatic of a deeper transformation in the crypto sector. While speculative objects like meme coins and NFTs are collapsing, capital is shifting toward assets with real utility and practical use cases.

For a sustainable bull run in the crypto space, more than external narratives and FOMO are needed. The industry must intensify its focus on fundamental value creation and practical applications. Only then can the next upswing be built on a solid foundation – rather than on the shaky pillars of speculative hype.