Memecoins are trading near year-end lows, marking a big reversal from the speculative peak reached at Christmas 2024.
According to data from CoinMarketCap, memecoins fell 65% for the 12 months to a market cap of $35 billion as of Dec. 19, its lowest level in 2025. They recouped some losses on Friday, rising to about $36 billion.
Last 12 months, memecoins boomed on Christmas Day, recording a worth of about $100 billion, in keeping with data from CoinMarketCap.
The memecoin sector's trading volume fell in tandem with its value, falling 72% over the 12 months to $3.05 trillion, because the trend in crypto retail investments shifted away from highly speculative assets.
Memecoins have historically served as a temperature check on retail traders' risk appetite. The collapse within the sector's market capitalization signals a more cautious market environment during which it’s harder to draw capital.
One-year market cap chart of the Memecoin sector. Source CoinMarketCap
How politics influenced the rise and fall of the memecoin sector
Political narratives have been a key driver of memecoins' explosive growth in 2024, making the sector a proxy for election-related speculation.
According to CoinGecko, excitement over the US presidential race helped drive memecoin valuations to record highs as election-related tokens dominated social media, launchpads and on-chain activity.
However, these political dynamics continued to drive the sector's decline into 2025. High-profile launches linked to political figures, including US President Donald Trump's Memecoin token and Libra linked to Argentine President Javier Milei, marked a turning point.
CoinGecko added that sharp price drops and insider activity undermined confidence and turned sentiment into skepticism.
NFTs hit 2025 lows in December
In addition to memecoins, non-fungible tokens (NFTs), one other speculative crypto sector, also saw a pointy drop in valuation in December.
Data from CoinGecko showed that NFTs fell to $2.5 billion in December, their lowest level in 2025. This corresponded to memecoins' 72% decline from a peak of $9.2 billion in January.
Activity also fell because the variety of weekly sellers fell below 100,000 for the primary time since April 2021, in keeping with NFT data tracker CryptoSlam.
