Over 75% of Memecoins Were Created in 2024, But 97% Are Dead

Memecoins have frantically proliferated in 2024, but few projects will see their first birthday.

A Nov. 4 report from Binance Research found that more than 75% of all memecoins created were spawned this year. Memecoins have grown to represent 11% of the altcoin market cap, up from just 4% in 2022.

However, 97% of the tokens have since been rendered completely inactive, no longer driving any trading volume. Just 0.23% of memecoins retain a market cap above $1 million.

Joshua Wong, a macro researcher at Binance, described memecoins as embodying many of web3’s best and worst attributes.

“In many aspects, memecoins try to embody the fundamental principles of the cryptocurrency industry — fairness, transparency, decentralization,” Wong said. “In other ways, they reveal a different side of the industry, demonstrating a distinct prioritization of financial profit and less focus on technological advancement.”

Memecoins’ market share of the altcoin market cap peaked at 12% in 2021 as Dogecoin (DOGE) and Shiba Inu (SHIB) soared to respective market caps of $80 billion and $39 billion after Elon Musk’s Dogecoin endorsement ignited a dog-coin trading frenzy.

In a sign of the recent acceleration of memecoin speculation, the report noted that dogwifhat (WIF), the booming Solana-based memecoin, tagged a $1 billion market cap just 104 days after launching. For comparison, SHIB took 279 days, and DOGE took eight years.

High trading velocity

The velocity of memecoins is greater than other web3 segments, with daily trade volume for meme tokens averaging at 11% of the sector’s combined market cap, according to research from ArkStream Capital, a venture capital firm.

The daily turnover of DeFi tokens’ capitalization is 5%, Layer 2 tokens is 7%, and Layer 1 network tokens is 4%.

ArkStream Capital found that listing memecoins has become an effective vehicle for centralized exchanges seeking to bolster volume. Memecoins currently account for 20% of the top 30 spot trading pairs by volume on Binance.

Binance leads the cryptocurrency exchange market, hosting $28.27 billion or 24.8% of the sector’s volume, followed by Bitrue with $9.94 billion or 8.7%, and Crypto.com with $7.43 billion or 6.5%, according to data from Messari.

The Evolution of Memecoins

ArkStream Capital categorizes memecoin development into three phases: the germination phase (2013-2019), the chaotic phase (2020-2022), and the rapid growth phase (2023-2024).

During the germination phase, Dogecoin was the sole memecoin of note, ranking 34th in market cap by the end of 2019. The chaotic phase saw the rise of Shiba Inu (SHIB), Floki Inu (FLOKI), and People (PEOPLE), as memecoins capitalized on the initial dex offering boom of DeFi Summer. This period also witnessed significant price fluctuations driven by celebrity endorsements, particularly from Elon Musk.

In 2024, the memecoin market entered a rapid growth phase accelerated by PumpFun, the no-code token launchpad on Solana, giving rise to new tokens like BOME, NEIRO, and GOAT. As of Q3 2024, memecoins collectively held a market cap of $50 billion and drove roughly $5 billion in daily trade.

ArkStream Capital projects this market cap share could grow to 3.54% by 2025 and 7.81% by 2030.