Memecoin Market Stagnates Despite Improved Economic Conditions

Last updated on March 15th, 2025 at 08:25 am

Memecoins continue to struggle with no signs of recovery following the mid-February crypto market crash. According to a new Matrixport report, the memecoin sector remains stagnant despite conditions that typically favour cryptocurrency growth, including a weakening U.S. dollar and improved inflation data.

Matrixport analysts have warned traders about an impending crypto consolidation phase that could particularly affect memecoins. Their analysis reveals a significant tightening of liquidity on Solana-based automated market makers. Raydium’s total value locked (TVL) has plummeted by 71%, while Solana’s own TVL has dropped by up to 37%.

Traditionally, rising global liquidity—measured by money supply from 28 central banks worldwide—boosts alternative investments like cryptocurrencies. When central banks increase market liquidity or maintain accommodative policies, investors typically gain confidence to invest in riskier assets like cryptocurrencies. However, Matrixport’s analysis indicates this effect has not extended to the memecoin market.

The analysts noted that the latest U.S. inflation report showed better-than-expected results, though ongoing trade policy uncertainties continue to prevent the Federal Reserve from easing monetary measures.

Their report also highlighted a significant downturn for Pump.fun, the leading memecoin launchpad platform. Despite generating revenues exceeding $582 million over the past 12 months—making it one of the most profitable crypto projects of this cycle—recent revenue growth has dropped dramatically.

Data from DefiLlama shows that Pump.fun’s daily revenue has fallen below $1 million since March 8, returning to levels last seen in September 2024. This contrasts sharply with January 2025, when the launchpad generated up to $4.38 million in daily revenue.

This analysis from Matrixport might be a bit of a let down as new data data revealed the memecoin sector experienced explosive growth throughout 2024. Its market cap soared from $20 billion in January to over $120 billion by December—a 500% increase driven by social media hype, celebrity endorsements, and viral trends that fueled investment in popular coins like DOGE, SHIB, and PEPE.

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