The crypto market is undergoing significant changes, especially among memecoins, which are losing ground to the growing dominance of Ethereum.
Decline of Memecoins Dominance
The dominance of memecoins in the altcoin market is falling. According to data from CryptoQuant, this key indicator has dropped to 0.039, the lowest level since February 2024. There is a noticeable decrease in interest in memecoins as they struggle to compete with the growth of Ethereum.
Ethereum Dominance and Institutional Investors' Impact
Ethereum's growth, which has increased by 25.41% in recent months, overshadows memecoins. During this time, there has been a massive influx of institutional capital, such as the $640 million invested by BlackRock in the Ethereum ETF. These flows create a 'suction effect', depriving memecoins of the necessary liquidity to rise.
Predictable Cycle and Future of Memecoins
Despite the current decline, experts believe that a new twist may come soon. There are cycles of four phases in the cryptocurrency market, and memecoins may rise again in the altseason phase, which traditionally concludes with a sharp increase in volumes and prices of memecoins.
Although the decline in memecoins dominance may seem like the end of a season, it is more of a tactical transition. A reversal in the cycle is anticipated that could lead to a revival of interest in memecoins during the overall growth of altcoins in the market.
