Meme Coin Craze Fizzles: Solana Trading Volumes Plummet 81%

Trading volumes for Solana Pump.fun tokens have plummeted to record lows since Christmas, raising questions about the sustainability of the meme coin craze. In mid-January, the ecosystem's trading volume peaked at $3.1 billion on Raydium, a decentralized exchange, but two weeks later, it had dropped to $569 million, a staggering 81% decline.

The surge in trading volume in mid-January coincided with the launch of TRUMP and MELANIA meme coins on the Solana network. TRUMP briefly hit $75 billion in fully diluted value (FDV), while MELANIA pumped to $13 billion FDV. However, these launches also sucked liquidity from other tokens, contributing to the broader market de-leveraging event in early February, which dented market sentiment further.

The altcoin market has been weak, with a $234 billion loss in two weeks. The muted meme coin trading volume is part of a broader market slowdown following a massive liquidation event and macro uncertainty. Since last December, the altcoin market cap has dropped from $1.896 trillion to $1.450 trillion, with nearly $450 billion wiped from the sector in the past two months.

Despite the decline, some top Pump.fun tokens with significant dominance have been within the AI/DeFAI narrative. Fartcoin topped the chart, while AI Rig Complex (ARC) came in second. Other AI tokens like Griffain and ACT were within the top 10 Pump.fun tokens by market cap. Given the dominance of the AI narrative in the ecosystem, these tokens could potentially recover faster if market sentiment improves compared to traditional meme coins.