Is the rising market capitalization of meme coins a sign of bigger things to come?

Will the surge in meme coins continue? Opinions are divided on whether this trend will last or whether it is just a bubble waiting to burst.

Meme coins they are back in the spotlight. In the last 30 days, the Meme coin market capitalization rose more than 36%, leaving many traditional altcoins and even Bitcoin (Bitcoin) in the dust. From June 3rd market capitalization amounts to the impressive figure of 63.5 billion dollars.

Seven of the top 100 cryptocurrencies by market capitalization are meme coins. Dogecoin (DOGE), the largest meme coin by market cap, posted a 22% gain, trading at $0.1614. Not far behind is Shiba Inu (SHIB), up 10% and trading at $0.00002598.

However, the real stars of this rally are Pepecoin (PEPPER) and FLOKI (FLOKI). PEPE has skyrocketed by over 100% in just 30 days, and is now trading at $0.0000153. FLOKI is not far behind, up 64%, and trading at $0.0002683.

The excitement doesn’t stop there. A whale, recently raised 90 million DOGE, worth $14.28 million, from Robinhood.

Additionally, Whale Alert, an on-chain transaction monitoring platform, reported a massive movement of 499.42 million DOGE, worth approximately $81.10 million, between two unknown wallets.

So what’s driving this surge in meme coins? Why are they outperforming many other cryptocurrencies? We understand what’s fueling this hype and where it could go from here.

Newcomers make noise

As meme coins continue to grow, Solana (SOL) Meme-based meme coins are having a spectacular run of their own. Over the past 90 days, the Solana-based meme coin dogwifhat (WIFE) rose more than 134%, now trading at $3.39.

But this is just the beginning. A New Player, Book of Meme (BOME), has jumped into the top 100 cryptocurrencies, with a staggering gain of over 1,385% over the past 90 days, currently trading at $0.01354.

The surge in Solana-based meme coins does not happen in isolation. Celebrity tokens recently made their debut on Solana, adding to the buzz around meme coins.

Just last week, Caitlyn Jenner launched a coin called JENNER via the SOL-based meme coin portal pump.fun. However, the launch was marred by controversy.

Soon after trading began, developers abandoned the token, causing its price to plummet and leading to accusations against Jenner of orchestrating a rug pull.

Reports later revealed that a known fraudster named Sahil was behind the incident. Sahil allegedly took advantage of Jenner’s lack of knowledge about the web3 space, using his role as a middleman to profit from celebrity meme currency.

Less than 48 hours later, Australian rapper and OnlyFans model Iggy Azalea launched a token with the ticker MOTHER. According to DEX Screener, Azalea’s celebrity cryptocurrency has surged more than 30,000%, reaching a market capitalization of $30 million.

But the drama didn’t stop there. Sahil also flipped an IGGY coin, trying to capitalize on the Azalea hype and make millions in another pump-and-dump scheme.

In response, Azalea distanced herself from Sahil’s IGGY coin. She approached X Spaces to promote her token and expressed her enthusiasm for the decentralized meme ecosystem.

“This is a bet, this is a game. That’s why it’s fun. Play or don’t play. This is your decision,” Azalea said during an online discussion.

Because meme coins are mobilizing

Several factors are driving the meme coin rally, and it’s not just fun and memes. One of the main reasons is the positive news coming from regulatory bodies.

The Securities and Exchange Commission (SEC) recently approved eight spot Ether exchange-traded funds (ETFs) from large companies. While Ether itself saw only a modest increase, this regulatory green light has sparked optimism across the cryptocurrency market, particularly among the riskier, higher-yielding meme coins.

Historically, pro-crypto news tends to generate excitement and money flow in the ecosystem, which trickles down to smaller projects. Meme coins, with their relatively small market capitalization, often witness wild swings during these bullish periods.

However, these are not just one-off events like ETF approvals. The recent hype around Solana has carved out a niche for itself as a go-to chain for “speculative fun,” attracting traders willing to bet on meme coins.

It is worth noting that the commercial ETH ETFs approvals are still in the early stages. The SEC approved the initial Forms 19b-4, allowing the securities to be listed on the exchange.

However, the final S-1 documentation, which details the structure and management of the ETFs, has yet to be approved. Once these get the green light, we could see even more market activity and potential price movements.

Community and experts weigh in: Does the meme coin rally continue?

As the meme coin rally continues to capture attention, opinions are divided on whether this trend will last or if it is just a bubble waiting to burst.

On Twitter (X), a crypto analyst spoke about the importance of current price levels for major meme coins such as FLOKI and DOGE. According to him, these coins are at their uptrend support, a crucial level that could determine the next move.

If they rebound from this support, we could see a broader rally in meme coins. However, if they lose support, a deeper correction could follow, which would affect the entire meme coin market.

Another user expressed concern about the flow of capital into meme coins and celebrity tokens. He pointed out that many good projects are suffering as investors pour money into these high-risk assets.

However, he sees this as a temporary phase, predicting that once the inevitable corrections (or “rugs”) occur, capital will flow back into quality projects.

A senior figure at Andreessen Horowitz (a16z), Eddy Lazzarin, also provided a critical perspective. He compared the meme coin ecosystem to a risky casino, suggesting it presents the cryptocurrency industry in a negative light.

“At best, it looks like a risky casino. Or a series of false promises that disguise a casino,” Lazzarin said, warning that this perception could hinder adoption, regulation and innovation in the industry.

Ethereum co-founder Vitalik Buterin also weighed in: criticizing the recent wave of meme coins, especially those with dubious themes or associations.

Buterin expressed his lack of enthusiasm for coins that initially promise excitement but then lead to disappointment and losses.

Meanwhile, Binance reported an explosion in the number of new tokens, especially on the Solana network. Over one million new tokens have been created since April, including more than 640,000 on Solana alone, mostly meme coins.

The various opinions and data suggest that although meme coins are enjoying a notable rally, the sustainability of this trend is questionable. Therefore, it is crucial to proceed with caution, keeping an eye on market trends and inherent risks. Never invest more than you can afford to lose.

Fuente