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Mt. Gox repayment triggers panic, but meme coins market cap surge 7.5% in a day – what’s fueling the rise?

mt-gox-repayment-triggers-panic-but-meme-coins-market-cap-surge-7-5-in-a-day-whats-fueling-the-rise
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Mt. Gox repayment triggers panic, but meme coins market cap surge 7.5% in a day – what’s fueling the rise?

What can you expect next from the meme coin market after a 7.5% surge in just one day? Read on

The crypto market has experienced quite a rollercoaster in the last 24 hours, bouncing back from stark losses triggered by two major events: the Mt. Gox repayment going live and the German government offloading its Bitcoin (BTC) holdings. 

These incidents caused widespread panic, leading to a sharp decline in crypto prices. However, in the past 24 hours, the meme coin market cap has bounced back and surged by nearly 7.5%, according to CoinGecko.

Leading this recovery are Solana (SOL) based meme coins, which have seen an impressive uptick of more than 14.5%. The star of the show is Bonk (BONK), which has surged nearly 12.5% and is currently trading at $0.00002641 as of July 9. 

Close on its heels is Brett (BRETT), hosted on Coinbase’s Base blockchain, which has risen by almost 7%, trading at $0.1306.

Additionally, PolitiFi meme coins, inspired by political figures and movements, have also seen significant gains. The market cap for PolitiFi meme coins has increased by nearly 13.7% in the last 24 hours. 

ConstitutionDAO (PEOPLE) has surged by 5.5%, trading at $0.05835, while the Trump-inspired MAGA coin (TRUMP) has risen by 6.1%, trading at $6.21.

Interestingly, dog-based meme coins, which once dominated the meme coin category, have seen a modest increase of around 6.3% in the last 24 hours. 

Low-cap dog-based meme coins are driving this growth, while popular ones like Dogecoin (DOGE) and Shiba Inu (SHIB) have declined by 0.9% and 2.6%, trading at $0.1085 and $0.00001638, respectively.

Let’s dive deeper into the meme coin ecosystem, explore the latest developments, and consider what might come next as the market continues to recover.

The craze around Solana’s Pump.fun

In the past couple of months, the Solana-based marketplace Pump.fun has emerged as a hub for meme coins.

Pump.fun allows users to create and distribute their own tokens, often memecoins. These tokens typically don’t have an intrinsic value beyond their novelty and the community built around them.

What distinguishes Pump.fun is its unique bonding curve mechanism: as demand for a token rises, its price increases along a curve, rewarding early investors.

Once a token’s market cap reaches $69,000, it qualifies for listing on the Solana-based decentralized exchange Raydium, with $12,000 worth of the token being deposited and subsequently burned.

Pump.fun has experienced substantial growth in its revenue generation. In its early days back in March 2024, the platform garnered daily revenues averaging $50,000 to $100,000. 

Fast forward to July 9, and those figures have surged to an average of $50,000 to $700,000 daily, with some days even exceeding $1 million.

Mt. Gox repayment triggers panic, but meme coins market cap surge 7.5% in a day – what's fueling the rise? - 1
Pump.fun daily revenue chart | Source: The Block

Notably, on July 1, Pump.fun achieved its largest-ever revenue of $1.99 million, nearly touching the $2 million mark, representing a 40x increase from its early days just a few months ago.

With such rapid growth, the platform has attracted the attention of numerous celebrities, although many of their meme coins struggle to sustain lasting market interest.

Solana-based meme coins continue their domination

The latest buzz surrounds Lionel Messi, the legendary Argentinian footballer and FC Barcelona icon, who recently endorsed the Solana memecoin Water (WATER) on his Instagram account to his 504 million followers via a story. Water’s Instagram page reaffirmed Messi’s endorsement as an official representation.

Post his announcement, according to CoinGecko, WATER surged nearly 180% in the last 24 hours as of July 9, trading at $0.0008998, though still down about 68% from its all-time high of $0.00278.

Mt. Gox repayment triggers panic, but meme coins market cap surge 7.5% in a day – what's fueling the rise? - 2
WATER 24-hour price chart | Source: CoinGecko

Launched just two weeks ago, WATER now commands a $66 million market cap and nearly $100 million in daily trading volume, according to DEX Screener.

Additionally, Solana-based pairs dominate on DEX Screener, with 75 of the top 100 pairs being Solana-based.

SOL-based pairs, majority of which are meme coins, have collectively amassed approximately $2 billion in trading volume over the last 24 hours, surpassing Ethereum-based pairs at $1.5 billion, Binance Smart Chain (BSC) pairs at $780 million, and Base pairs at $630 million, reflecting the rising interest in Solana-based meme coins.

Amid this excitement, Solana co-founder Anatoly Yakovenko has proposed further advancements in this vertical. He suggested enlisting developers to create custom features for meme coins, effectively reversing the initial coin offering (ICO) process.

Yakovenko’s pitch involves meme teams offering grants to developers, who would then choose the best options from projects with fair and transparent terms.

His proposal, shared on social media, sparked discussions about how meme projects could establish a steady onboarding process for retail users and incentivize institutional investors to adopt cryptocurrencies.

What to expect next?

Meme coins are no longer just about DOGE and SHIB. With the rise of celebrity tokens, PolitiFi tokens, and an overall surge in new meme coins, the market is becoming saturated. Thousands of meme coins are entering the space every day, each with its unique community and story.

If the bullish momentum continues and the market keeps recovering, we could see meme coins surge even more. 

At their peak this year, meme coins collectively commanded a market cap of over $70 billion. However, this figure has declined by about 35.7% to around $45 billion as of now.

This scenario mirrors the NFT boom of 2020 and 2021. During that period, NFTs offered little real utility beyond being collectibles, leading to a massive bust. 

While NFTs have since evolved to provide more utility, the sector has struggled to regain its former glory. The same could be happening with meme coins. 

Despite their current popularity, many meme coins lack substantial utility, and their value is often driven by hype and community enthusiasm.

As we move forward, it’s essential to approach meme coin investments with caution. The market’s volatility means that prices can surge or plummet rapidly. 

While the potential for large gains exists, so does the risk of substantial losses. It’s crucial to do thorough research and understand the fundamentals of each coin before investing.

Stay informed, diversify your investments, and never invest more than you can afford to lose.