Binance Report Reveals 97% of Meme Coins Facing Collapse Amid Market Risks
On November 4, 2024, Binance Research released an in-depth report shedding light on the meme coin market, a sector characterized by extreme volatility and frequent market manipulation.
The report, titled Understanding the Rise of Memecoins, spearheaded by Macro Researcher Josh Wong, reveals that nearly 97% of meme coins have seen drastic drops in trading volume, underscoring their instability and short-lived appeal.
Wong noted that most meme coins created during the 2023–2024 frenzy have already “died,” with trading volumes dropping close to zero. This reflects a trend where rapid growth and speculative trading have driven these tokens up temporarily, often to the detriment of retail investors who face losses when the market cools.
According to the report, meme coins have been proliferating at a remarkable rate due to their accessibility and ease of creation. In the past year alone, over 75% of meme coins were launched, rapidly attracting investor interest. Wong pointed out that meme coin buyers are generally quicker to invest compared to those considering technology-based altcoins, allowing meme coins to spread at an impressive pace.
READ MORE: Crypto Founders Challenge Coinbase’s Claims on Listing Fees Amid Binance’s Zero-Cost Approach
This growth has allowed some meme coins to achieve high market caps in record time. For instance, WIF hit a $1 billion market cap in just 104 days, while Shiba Inu (SHIB) took 279 days, and Dogecoin (DOGE) took eight years to reach a similar milestone. Although the majority of meme coins fail to sustain relevance, established ones like DOGE and SHIB remain popular, with DOGE now over a decade old and SHIB at four years.
However, Binance Research cautions that these quick gains come with considerable risks. Wong emphasizes that meme coins are extremely speculative, depending heavily on market sentiment rather than intrinsic value, making them highly volatile. The report also highlights the prevalence of pump-and-dump schemes, where early investors profit at the expense of later entrants. While meme coins offer accessibility and transparency, these factors have not fully protected investors from market exploitation.
With new meme coins flooding the market, Binance Research advises caution, reminding investors that while a few meme coins like DOGE and SHIB have managed to build strong communities, most will likely fade away without lasting impact.
Alexander Stefanov
Reporter at CoinsPress
Alex is an experienced finance journalist and a cryptocurrency and blockchain enthusiast. With over five years of experience covering the industry, he deeply understands the complex and constantly evolving world of digital assets. His insightful and thought-provoking articles provide readers with a clear picture of the latest developments and trends in the market. His passionate approach allows him to break down complex ideas into accessible and insightful content. Follow up on his content to be up to date with the most important trends and topics - stay ahead of the curve with CoinsPress.
