Memecoins Are Never Coming Back

i am not early enough to claim clout for this, or late enough for people to say it was obvious but to make a big statement: i think memecoins trenches are done

[the title is specifically worded to attract more attention, "The Trenches Are Cooked: What's Next?", was my first pick]

i think the entire run is mostly finished, with a possibility of existing coins maybe going back up to ATH, but not new runners to the billions again (that sustain), and any mid-low level coin has 0.1% chance of coming back

you can plot the moments in the chart that led to the imminent destruction of trenches: $TRUMP was the one that changed it all, then $MELANIA, and subsequently many other rugs with the last bullet in the chamber being $LIBRAthe inevitability of large scale scams and rugs was the same as the likelihood of pump(.)fun being created one way or the other

the pendulum swung too far both ways (PvE memecoin wif hat climbs to billions to cabal bundled country rug scams) and most reaped the gain or pain in that process

There Are No Holders

the thing about the Solana trenches is that it was all momentum based, the highest concentration of people buying these tokens are in it for money because the traditional "cons" with other projects no longer exist, naturally this means the coins will drop faster than most

the memecoin szn boasted about how it was the purest form of trading because it had no limitations, and this is a big reason for why they had such an insane run, however that comes with big downsides

once the excitement of making money runs out, the holders leave and that same group of people will leave the trenches -- unlike other coins where you still have believe that believe in the project... well because there is <literally something> vs. nothing

this was also somewhat applicable to NFTs too, but not the same for memecoins which completely ditched the idea of utility, excluding a few that have surpassed an attention barrier and become "timeless" to some degree: see $PEPE

there are also relatively new things that came out of this memecoin szn, such as copytrade farming. people always tracked wallets before on-chain but you never had the insane influx of coins; trading UX that we have now on Solana & for NFT szn it was never that popular because of the liquidity. now you have people that make hundreds of thousands of dollars that farm copytraders (i am not calling anyone out specifically, because its a general thing, anyone that has gained fame for "making a lot of money" on a public wallet naturally has copy traders, some take advantage of it). CEX's also have had copytrading features forever but you couldn't buy a $10k mcap coin for 5 SOL and sell it for 10 SOL 15 seconds later.

this led to a lot more people running into the incinerator following influencers but in a different way from usual, difference here is there was close to no social lashing because traders were not explicitly shilling coins

Comparison To NFTs

i am sure you guys remember how big NFTs were, i am going to use this comparison because it was last cycles' memecoins just like how ICOs were 2017's trend

virtually everyone at the world heard about nfts at one point, it was widely memed across the internet, dozens of A list celebrities launched their own projects (naturally *all* rugged), we had tens of billions of dollars traded, multiple collections at 6 figure floors and more

in that run, OpenSea was the biggest winner, printing over a billion dollars in fees -- for reference, pumpfun has *only* done about $500M

their is one major difference here though, this time there are many protocols that are benefitting from the run at a massive scale

if you take the low end of the estimation, roughly ~$4B "extracted" in this run, it is not small by any means (the literal president and most powerful individual in the world launched a coin that full sent to $70B in 2 days, it isn't "early" either)for comparison my rough estimate is that nfts were just a bit under that if you include marketplaces, royalties and mints

this is to say it's already eclipsed the trend of last cycle, and the benefit of liquidity means the market corrected much faster too

also a lot of notable SOL people fixated on the word "extraction" (hence why I put it in quotes) comparing it to traditional businesses --- i don't think that is the right comparison by any means, if i buy a game i get entertainment value from that and the company gets my money --- positive sum

you can argue a lot of crypto is zero-sum but the intention of many is to provide something of value first and foremost

however pumpfun is negative sum due to that extraction because its a casino used for creation of valueless tokens where the primary usecase is to gamble for more (i wouldn't apply this to projects that aren't specifically for memecoins like Jup or Phantom albeit they benefit the most from them)

So... What's Next?

no one truly knows when the cycle will end, and that will really determine what happens short-term

for every cycle, there is a new trend, but it could also be a transformed version of the previous one --- and a resurgence (or it could be complete death) because people always want to gamble for the next 100x

going back to what i mentioned previously, i think the likelihood of memes coming back specifically is lower than others because there are no holders, there are no believers

pretty much the biggest will survive, anything below that will die, and a higher likelihood of newer coins outperforming everything that exists now IF the market returns

you simply have to position yourself for that scenario: survive, survive and survive

if you die or have no capital before the next trend you will struggle to adapt, adaptability is extremely important in a market like this, everyone makes money in a bull market, making money in a bear market is the real skill, and then subsequently adapting to the next bull market (all cycles require different mindsets)

i leave you with this article that goes a bit deeper into why getting rich is half the equation, the other half is keeping it, some actionable points in doing that:

PS: if you think it's down 90% so the advice is useless, understand that it can go down another 90% :)