Crypto traders return to Memecoins, trading volume up 106%.
Memecoin traders locked in profits on Monday after a strong start to the year, analysts said, as memecoin trading volume increased and memecoin marketcap fell.
Memecoin's trading volume rose to $5.62 billion on Monday, up 106% from a day earlier, while memecoin's market capitalization fell 6%, according to crypto data platform CoinMarketCap.
The amount has since fallen to $3.6 billion, down more than 24 percent on the day.
Vincent Liu, chief investment officer at Kronos Research, told Cointelegraph that memecoin's trading volume indicates more congestion than market penetration with declining market potential, and particularly profitability, short-term alienation and capital turnover.
“In thin liquidity conditions, higher activity can still drive prices lower as volume increases,” he said. “The initial compression and reduction in volume indicate an approximate reduction in speed.”
“Once profit-taking, liquidation and spin-off trades are absorbed, fast traders pull back, expand and their participation slows down. Volume increases briefly around triggers before quickly reversing.”
The year started with a bang for memecoins
Memecoins saw their market capitalization rise from $38 billion on December 29 to $47.7 billion before slowing down in the following days.
Kadan Stadelman, chief technology officer of the blockchain-powered Comodo platform, told Cointelegraph that gains in the sector are often the result of speculation and can be candidates for reversal rather than holding steady.
“The overall fundamentals of the memecoin market are weak and driven by speculation. This results in a constant rotation of capital between memecoins, leading to a drop in value in certain coins and appreciation in others,” he said.
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The chaos of the Crypto market has especially reduced memecoins in the past year, driving the number of crypto project failures to more than 11.6 million in 2025, the highest level recorded in one year, according to a report by CoinGecko research analyst Shawn Paul Lee.
Memecoins will be replaced by Bitcoin in 2026
Market intelligence platform Sentiment reports that there has been a recent buzz in social media chats surrounding memecoins.
The discussions mostly focused on frustrations about frequent carpet-dragging, although traders are drawn to tokens for quick leverage, Santiment said.
Memecoins are among the riskiest bets in crypto, and their success or failure can be a testament to how much risk investors are willing to take.
Stadelmann predicts that Bitcoin (BTC) will play a major role in the memecoin sector this year and its performance will either help or hinder the market.
“Memecoins market performance in 2026 will depend on Bitcoin as usual, with gold being low in 2025. The same may happen in 2026, which will be bearish for memecoins,” he said.
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