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

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

Meme coins are back in the spotlight. In the last 30 days, the meme coin market value increased by more than 36%, leaving many traditional altcoins and even Bitcoin (Bitcoin) in the dust. From June 3rd, the market value is at a staggering $63.5 billion.

Seven of the top 100 cryptocurrencies by market cap are meme coins. Dogecoin (DOGE), the largest meme coin by market value, saw a 22% gain, trading at US$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 (PEPE) and FLOKI (FLOKI). PEPE soared more than 100% in just 30 days, now trading at US$0.0000153. FLOKI is not far behind, up 64%, trading at $0.0002683.

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

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

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

New entrants making noise

As meme coins continue to rise, Solana (SUN)-based meme coins are having their own spectacular run. Over the past 90 days, the Solana-based dogwifhat meme coin (WIF) has soared more than 134%, now trading at $3.39.

But this is just the beginning. A new player, Book of Meme (GOOD), has rocketed into the top 100 cryptocurrencies with an impressive gain of over 1,385% in the last 90 days, currently trading at $0.01354.

The rise in Solana-based meme coins is not happening in isolation. Celebrity tokens recently made their debut on Solana, adding to the buzz surrounding meme coins.

Last week, Caitlyn Jenner released a coin called JENNER via the SOL-based meme coin portal bomba.fun. However, the launch was marred by controversy.

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

Later reports revealed that a notorious scammer named Sahil was behind the incident. Sahil allegedly took advantage of Jenner’s lack of knowledge about the web3 space, using his role as an intermediary to profit from the celebrity’s meme currency.

Less than 48 hours later, Australian rapper and OnlyFans model Iggy Azalea launched a token under the ticker MOTHER. According to DEX Screener, Azalea’s celebrity crypto is up more than 30,000%, reaching a market cap of $30 million.

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

In response, Azalea distanced herself from Sahil’s IGGY coin. She took to X Spaces to promote her own 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 the game or don’t play. It’s your decision,” Azalea said during an online discussion.

Why meme coins are rising

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

The Securities and Exchange Commission (SEC) recently approved eight spot Ether exchange-traded funds (ETFs) of large companies. While Ether itself only saw a modest surge, this regulatory green light sparked optimism across the crypto market, especially among the riskier, high-reward meme coins.

Historically, pro-crypto news tends to generate excitement and money flow into the ecosystem, which spreads to smaller projects. Meme coins, with their relatively small market capitalizations, often witness wild swings during these bull periods.

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

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

However, the final S-1 filings, which detail the structure and management of the ETFs, have not yet been approved. Once they get the green light, we could see even more market activity and possible price movements.

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

As the rise in meme coins continues to draw 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 top meme coins such as FLOKI and DOGE. According to him, these coins are at uptrend support, a crucial level that could determine the next move.

If they recover from this support, we could see a broader recovery in meme coins. However, if they lose support, a deeper correction could occur, affecting the entire meme coin market.

Another user expressed concern about the flow of capital into meme coins and celebrity tokens. He highlighted 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”) happen, capital will return to investing in quality projects.

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

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

Ethereum co-founder Vitalik Buterin also chimed in, criticizing the recent rise in meme coins, especially those with dubious themes or associations.

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

Meanwhile, Binance reported an explosion in the number of new tokens, especially on the Solana network. Since April, over a million new tokens have been created, with over 640,000 on Solana alone, mostly meme coins.

Diverse opinions and data suggest that although meme coins are enjoying a remarkable recovery, the sustainability of this trend is questionable. Therefore, it is essential that you be careful, keeping an eye on market trends and the inherent risks involved. Never invest more than you can afford to lose.

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