Memecoin Strength Returns After Historic Market Decline: Are We Seeing a Comeback?

The memecoin market faced significant challenges in 2025, experiencing a stark decline after the euphoric phase of 2024. However, recent trends may indicate a potential recovery, as some memecoins are showing signs of stabilizing and rebounding.

Key Takeaways

In 2025, the memecoin market suffered a dramatic decline, reaching historical lows.
The ratio of memecoins to altcoins fell sharply, indicating reduced investor enthusiasm.
Recent price movements suggest a tentative stabilization, with some major memecoins beginning to recover.
A technical rebound is observed, but the broader trend remains cautious, as longer-term moving averages are still acting as resistance.

Memecoin Strength Returns After Historic Market Decline: A Setup For A Comeback?

Memecoin Market Faces a Tough Year

The memecoin market experienced a harsh decline in 2025, marking one of the steepest downturns in its history. Following the exciting memecoin boom that peaked in November 2024, the market saw increasing selling pressure. As liquidity diminished and market momentum waned, most memecoins entered extended periods of drawdown, significantly underperforming compared to the broader cryptocurrency market.

As risk appetite declined, the dominance of memecoins in the altcoin sector lessened throughout the year. By December 2025, memecoin dominance hit a historical low, reflecting a widespread retreat from speculative assets among retail investors. Many traders completely exited their positions, reinforcing the belief that the memecoin cycle had ended.

Yet, extreme pessimism can often signal turning points in the market. An analysis by Darkfost from CryptoQuant suggests that the current decline in memecoin dominance mirrors previous cycles’ historic lows. Remarkably, the last time memecoin dominance fell to similar levels was right before a strong resurgence in the sector, fueled by renewed capital, new narratives, and aggressive speculation.

Signs of Stabilization in Memecoin Dominance

Recent analysis of the on-chain data reveals just how much the memecoin market has declined compared to the broader altcoin market, prompting some investors to take a renewed interest. Darkfost’s analysis compares the total market capitalization of major memecoins against that of leading altcoins.

In November 2024, during the height of speculative trading, this ratio reached about 0.11, meaning memecoins made up around 11% of the entire altcoin market. This peak was characterized by high enthusiasm, significant retail involvement, and a willingness to take risks.

Memecoin Dominance in Altcoin Markets | Source: CryptoQuant

By December 2025, this ratio had plummeted to roughly 0.032, indicating that memecoins lost nearly two-thirds of their representation in the altcoin landscape. This sharp decline corresponds with prolonged underperformance, capital shifting to larger assets, and a broad retreat following months of price drops.

Fortunately, recent movements in prices suggest that the trend of decline may be slowing. In the past few days, several major memecoins have shown significant rebounds, which could point to renewed speculative interest. While it’s too early to call for a full trend reversal, this indicates that not all selling pressure is one-sided.

Currently, the data suggests a tentative stabilization period rather than a confirmed memecoin season. For high-risk investors, such low relative valuations have historically led to sharp, sentiment-driven rallies—assuming that risks are properly managed and expectations are realistic.

Technical Rebound After a Prolonged Downtrend

The market capitalization of memecoins displays a clear structural change following months of persistent weakness. Throughout the latter half of 2025, the total market cap of memecoins steadily declined. The market formed a series of lower highs and lower lows, consistently staying below the 50-day and 100-day moving averages.

Memecoin Market Cap rebounds | Source: MEME.C Chart on TradingView

However, recent price movements indicate the first meaningful effort at stabilization. The market cap rebounded sharply from December lows around the $35–38 billion zone, moving back up to the $46 billion mark. This increase was accompanied by a striking rise in trading volume, signifying renewed market activity rather than a mere technical bounce from thin liquidity.

Despite this improvement, the overall trend remains cautious. The memecoin market cap continues to trade below its long-term moving averages, which are still sloping downwards and providing resistance around the $50–55 billion range. This situation suggests that while the aggressive decline has halted, the market has yet to demonstrate a definitive uptrend.

In essence, the chart indicates a relief rally within a larger bearish framework. For memecoins to maintain sustained momentum, the market must consolidate above the current levels and reclaim higher moving averages, signaling that speculative capital is returning with confidence rather than merely seizing short-term opportunities.

Featured image from ChatGPT, chart from TradingView.com.