Recent developments in the cryptocurrency sector have seen memecoins face a significant decline in market share, attributed to the rise of Ethereum.
Reasons for the Decline in Memecoins
According to CryptoQuant, the market share of memecoins has dropped to 0.039. The primary driver of this trend is believed to be Ethereum's increasing dominance. Ethereum seems to be absorbing a significant portion of market liquidity, leaving less room for investment in memecoins and other altcoins. Discussions on social media reflect this sentiment.
Comparison of Ethereum and Memecoin Performance
Since April, while memecoins have seen their total market value rise by approximately 79.5%, Ethereum has outperformed them with a remarkable 215.91% increase. This month, Ethereum continued its upward trend with a 25.41% gain, whereas major memecoins such as Dogecoin, Shiba Inu, and Pepe achieved only modest successes. This variance indicates Ethereum’s siphoning of market liquidity from memecoins.
Memecoin Prospects in the Future
Market analysts propose potential renewals in memecoin rallies. The market cycle progresses through four stages, with Ethereum currently leading in the second stage. Merlijn The Trader highlighted the significance of this phase. "We’ve waited years for this moment, and now we’re here. ETH just entered the 2nd stage of Ethereum season." During the third stage, Ethereum continues to excel over Bitcoin, fostering growth in large-cap altcoins.
Ethereum’s increasing dominance has adversely affected the market share of memecoins. However, future market cycles may shine a spotlight on memecoins again.
