The speculative frenzy surrounding cryptocurrency meme coins faces imminent collapse. Matt Hougan, Chief Investment Officer at Bitwise, believes this market segment could effectively disappear within months.
"The crypto market is processing the end of the meme coin frenzy," Hougan stated in a recent post on X. He indicated the decline would not be instantaneous. But the trend appears irreversible. "The combination of Melania, Libra, and the Lazarus Group using meme coins to launder stolen ETH will kill it dead," he warned.
Recent high-profile controversies have accelerated this decline. The MELANIA token, associated with the former US First Lady, has faced serious allegations. Similarly, the LIBRA coin promoted by Argentine President Javier Milei has encountered problems. Both projects saw insiders reportedly extracting millions of dollars.
More concerning is the activity of sophisticated criminal organizations. The Lazarus Group has reportedly used platforms like Pump.fun to launder over $1.5 billion in stolen funds. This Solana-based meme coin launchpad was recently compromised in a security breach. These incidents have undermined already fragile market confidence.
Hougan acknowledges this shift will create a temporary enthusiasm gap in cryptocurrency markets. However, he sees new investment narratives emerging rapidly. Institutional adoption of Bitcoin continues to gain momentum through ETFs and corporate treasury holdings. Stablecoins are becoming essential infrastructure as major financial institutions signal increased interest.
Additionally, tokenization is creating new liquidity in traditional asset classes. Decentralized finance applications are experiencing renewed growth. These developments are attracting both retail and institutional users with substantive innovations rather than speculative hype.
Not everyone shares Hougan's pessimistic outlook for meme coins. Ki Young Ju, CEO of Cryptoquant, recently defended the sector. "If you can create something people believe in, you can thrive as an entrepreneur in the crypto industry," he argued. Ju suggests meme coins tap into fundamental human psychological needs for shared symbols and community.
Despite warnings of its demise, the meme coin sector shows resilience in recent market activity. Its total market capitalization stands at $64.2 billion, reflecting a 1.2% increase over 24 hours. This growth contrasts with the broader cryptocurrency market's $109 billion decline during the same period. Seven of the top ten meme coins posted gains yesterday. Nevertheless, 90% of these same assets recorded losses over the past week, suggesting longer-term vulnerability.
Disclaimer: The information provided in this article is for educational purposes only and should not be considered financial or legal advice. Always conduct your own research or consult a professional when dealing with cryptocurrency assets.