Over 13 million memecoin tokens appeared in 2025, and a16z says the surge proves that rules are missing. Everyday buyers face wild price swings, pump-and-dump games and vanishing projects, with new traders and small brokers suffering the most due to the lack of a clear rulebook.
These coins start as internet jokes with no underlying tech work, and their prices move only with hype. That dynamic leaves buyers exposed to sentiment spikes rather than fundamentals.
The a16z report says the memecoin slice of the market hit about 127 billion dollars in December 2024—around 3.5 cents of every crypto dollar. Sites like Pump.fun let anyone launch a coin in minutes, and the supply exploded.
Washington spoke up: in February 2025 the SEC staff wrote that, under the Howey test, most memecoins do not count as securities, meaning federal investor protections do not apply.
What the tokens are and why they spread
The New York Department of Financial Services warned the public that the chance of fraud and total loss is “exceptional” with memecoin. Because most projects hold little cash and creators keep big piles of coins, scams are easy; sources say 99 of every 100 memecoins die within a year, and the losses fall on people who did not know the odds.
Analysts expect major ripple effects across markets, trading platforms, and regulation. Lawmakers are now under pressure to define clear rules for both token issuers and intermediaries, aiming to prevent confusion and misconduct. If fraudulent schemes continue to grow, investor confidence could erode, pushing money out of the crypto sector. In response, large exchanges are likely to tighten standards — listing fewer tokens or enforcing stricter identity checks — as they seek to avoid regulatory scrutiny and reputational damage.
The numbers highlight how high the stakes are. In 2025 alone, more than 13 million memecoins have been launched, following a year when their combined market value hit $127 billion in December 2024. Earlier this year, the SEC stated that most of these tokens do not meet the Howey test and therefore fall outside securities law, while the New York Department of Financial Services warned of an “exceptional risk of fraud or fund loss.” These signals have strengthened calls for lawmakers to pass the Digital Asset Market Clarity Act, a bill designed to draw sharper lines around what counts as a compliant digital asset.
Congress now reviews the Digital Asset Market Clarity Act. The vote will decide whether stricter rules arrive or the present gap stays open and leaves millions of buyers on their own.