Author: hyphin, author of On Chain Times; Translator: Golden Finance xiaozou

Since our last meme currency article (in March this year), the total market size and market size of the industry The market share has continued to grow with no obvious signs of stagnation. There is no doubt that he is the fastest horse on the track.

This phenomenon can be attributed to the viral nature of social media (its inherent nature), extremely low barriers to entry, and the constant emergence of new narratives that attract speculators, although many ( If not most) fail to sustain meaningful attention over the long term. Still, market participants have become accustomed to this, often jumping in and out of profitable short-term trends, capitalizing on momentum to reap gains while remaining loyal to high-conviction bets and making them more durable. Although some people are reluctant to admit it, in the current market environment, long-standing memes that have been well-tested by the market are less likely to die than those that are driven solely by impressions and do not provide any substantive value (limited to the transfer of funds). ) assets.

While Solana may not be the only contributor to the total market cap of these massive tokens, much of the activity in the space does take place within its on-chain ecosystem trenches. For this reason, this article will continue to focus on this chain in an attempt to provide an overall picture.

With the birth of pump.fun (a Solana native token incubation platform), local market dynamics have undergone major changes. Interacting with speculative tokens becomes easier, cheaper and safer (from a security perspective). With a user-friendly interface and standardized token deployment in a controlled environment, anyone can create new tokens based on common configurations, eliminating the risk of abuse by potential malicious actors hidden in smart contracts. This really only requires some creative input from the deployer and no technical knowledge is required. Abstract away all the complexity and focus on what really matters - massive speculation. When a tokenized meme is created, it can be traded directly on the platform’s internal market and is automatically deployed to Raydium once its market capitalization reaches approximately $69,000. However, most creations fail to reach this threshold and are never launched on the market.

Approximately one in every 100 tokens "graduates" from pump.fun, due to massive saturation and limited liquidity and other reasons beyond the scope of this article . Those who step into the ring have to show something interesting, shockingly unique, in order for the fighters in the trenches to take notice. Despite these difficulties, the protocol quickly established itself as a veritable gateway for trading micro-cap tokens and launching new ones, quickly surpassing all other competitors in the space.

So far, deployment dominance over other alternatives has beenhas reached an astonishing 71.9%, showing the widespread popularity and far-reaching influence of the application. The recent momentum has made it quickly become mainstream, and many new users from TikTok have joined with ambitions to make it bigger and make the fire burn even brighter.

Whether it is a secret release, a pump.fun release or a pre-sale of tokens, the vast majority of meme currency liquidity pools come from Raydium. The influx of a large number of memes into the market has increased its market share, and decentralized exchanges account for a large proportion of Solana's current on-chain transaction volume.

In the gold rush, those who sold shovels to speculators often gained the most. This analogy also applies to the situation at hand. No matter how well a meme coin performs, platforms that facilitate trading activity will benefit greatly from the volume generated by increased speculation. Many things and common sense suggest that only a few tokens gain traction, while the rest are destined to fade into obscurity. This view can be confirmed or disproven simply by looking at the market capitalization distribution of all existing trading pairs.

Distinguishing memes from non-memes on a larger scale is quite difficult due to the lack of effective labeling methods by data providers. After careful consideration, the approach used to curate the comprehensive dataset was to collect information on all Raydium liquidity pools with non-zero liquidity (as of November 25, 2024), excluding official token lists and legitimate projects in CoinGecko. The remaining 493,203 pools containing 474,161 uniquely addressed tokens will serve as the basis for this part of the analysis.

Most coins tend to be in the $100,000 to $10,000 range with even a very small amount of activity at any point in their lifetime, both in the early and An obvious peak is formed in the mid-term. It’s clear that a smoothly declining tail is forming in the chart – highlighting a handful of coins with high valuations, which is to be expected as maintaining a modest market cap in such a attention environment is challenging . While this example includes the entire dataset, it is also worth exploring potential structural distribution differences between tokens originating from pump.fun and tokens deployed directly to Raydium.

Looking at the two separately can provide important insights into apparent patterns in the overall distribution, as well as how each behaves and exhibits unique characteristics.

(1) pump.fun

Please note that pump.fun tokens need to exceed a certain market capitalization threshold to access the liquidity pool. Since more liquidity is provided when issued, Therefore their value is usually higher, in the $5,000 to $15,000 range. This suggests that most launch tokens are unable to maintain or exceed their pre-migration market cap to Raydium. A lot of these coins are also in the mid-range range (hundreds of thousands to small millions) because the deployment pipeline is somewhat over-the-topFilter out unappealing memes and allow the community to use the fame or traction gained on the platform in the process as a catalyst for growth.

(2) Direct Deployment

There is still significant density in the lower market capitalization bands, indicating that many smaller, less desirable tokens are struggling to gain significant traction force. Part of this may be due to reaching saturation, poor timing of these tokens being introduced to the market, or due to a distinct lack of narrative, originality, and proper publicity. Although not obvious, there is a greater concentration of extremely high market capitalization memes listed on multiple centralized exchanges, which predate pump.fun.

The aggregation around lower market cap tokens in our data set confirms the above. While trend exhaustion and the inevitable bursting of speculative bubbles are huge hurdles for any coin, misaligned incentives are largely responsible for the instant collapse and subsequent demise of many memes. Anonymous scammers mislead their users, and so-called “developers” with ulterior motives normalize blatant fraud in the field, causing many seemingly promising concepts to die immediately after their birth. Upon closer inspection, it turns out that a large portion of tokens are intentionally set up to fail in order to extract maximum value from unsuspecting speculators, which remains an ongoing concern for those brave enough to take the risk behind a desk. threats.

In the past 30 days alone, nearly two-thirds of all tokens have been slaughtered within the first 24 hours, with over 90% of available liquidity evaporating . Recovering from such catastrophic events is often impossible in the nascent years, but occasionally disgruntled token holders will engage in community takeovers by creating new social media accounts in an attempt to accounts to regain lost momentum and, in some cases, start over out of stubbornness or resentment. The consequences of this are what you can expect, but if done well it can potentially give supporters a decent exit.

The meme currency landscape on Solana is both unpredictable and dynamic, a mixture of unlimited creativity, rampant speculation, and ever-present risk. Platforms like pump.fun and Raydium have become the center of this thriving ecosystem, providing opportunities and challenges for participants. While a few prominent coins rose to prominence, igniting dreams of overnight fame, the sobering reality is that most meme coins failed to sustain their initial momentum, leaving only a series of dashed hopes. As this speculative frenzy continues, one thing remains clear: In a world where virality often trumps facts, caution and thorough investigation are crucial. Whether you're a curious onlooker or an active participant, navigating niche markets requires both a keen eye for trend judgment and a firm skepticism about promises of easy wealth.