Crypto Funds Shift 20% From Meme Coins to Altcoins

YZi Labs CEO Ella Zhang has recently highlighted a significant shift in the cryptocurrency market. According to Zhang, funds that were previously invested in meme coins are now flowing back into what are commonly referred to as "shitcoins." This shift is attributed to the lack of fundamental value in meme coins, which makes them unsustainable in the long run.

Zhang's comments come as the cryptocurrency market continues to evolve, with different types of digital assets gaining and losing popularity. Meme coins, which gained significant traction due to their community-driven narratives, have seen a decline in interest. This is because these coins often lack the underlying services, businesses, products, technologies, or innovations that drive long-term value appreciation.

In an interview, Zhang explained that while meme coins provided a more equitable entry point for investors, their popularity has waned over time. This is due to the weak fundamentals that these coins are built on. As a result, traders are now returning to venture capital-supported altcoins, which offer more stability and potential for long-term growth.

Zhang's observations align with the broader trend in the cryptocurrency market, where investors are increasingly looking for assets with strong fundamentals. This shift is evident in the decreasing ratio of meme coin market capitalization to non-meme altcoin market capitalization, indicating that funds are gradually moving away from meme coins and towards more sustainable digital assets.

The trend of funds flowing back from meme coins to shitcoins underscores the importance of fundamentals in the cryptocurrency market. As investors become more discerning, they are seeking out assets that offer real value and potential for long-term growth. This shift is likely to continue as the market matures and investors become more focused on sustainability and fundamentals.