The cryptographic industry says goodbye to the year with a sharp retreat in the memecoin market, which has lost 65% of its total value. According to CoinMarketCap reports from December 19, the capitalization dropped to critical levels due to a lack of liquidity. The sector’s total capitalization fell drastically this month before the astonished eyes of thousands of active retail traders.
Hard data reveals that the ecosystem’s valuation sank to 35 billion dollars recently across major exchanges. Although there was a slight bounce toward 36 billion on Friday, the trend remains bearish for most assets. Annual trading volumes plummeted steeply right now reaching just 3.05 trillion dollars in total accumulated volume. In this way, the sector experienced a 72% drop in its transactional activity compared to the previous cycle.
This scenario is diametrically opposed to the success experienced during Christmas last year around the world. At that time, joke assets reached a record valuation of 100 billion dollars. Interest in high-risk assets is disappearing as investors seek refuge in projects with greater real-world utility. Therefore, these criptocurrencies have stopped functioning as the main thermometer of the speculative appetite of the retail sector.
Failed political narratives and the distrust of new retail investors
During much of 2024, US and Argentine politics drove the explosive growth of various thematic tokens. Projects linked to figures like Donald Trump or Javier Milei dominated social media and launch platforms. The politicization of digital assets generated a bubble that ended up bursting violently in the middle of this year. However, the momentum quickly turned into skepticism after multiple suspicious insider trading activities were detected.
On the other hand, the lack of transparency in new launches pushed more conservative participants away from the ecosystem. Sudden price collapses and internal manipulations undermined the little confidence that remained in these digital assets. Distrust in recent launches paralyzed capital investment of fresh funds into the digital wallets of global users. Thus, market sentiment shifted toward extreme caution, making it difficult for current prices to recover.
Can other speculative sectors like NFTs regain their former glory anytime soon?
Likewise, the digital collectibles or NFT sector has followed a very similar downward trajectory this December. Its valuation fell to 2.5 billion dollars, marking the lowest point of the entire 2025 year. The digital collectibles market faces a crisis of participation that had not been seen for four years. This represents a 72% decline from the peak of 9.2 billion registered last January.
Finally, user activity on these platforms shows generalized and worrying fatigue for developers worldwide. The number of weekly sellers fell below 100,000 for the first time since April 2021. The reduction in the active user base worries significantly the companies that depend on these daily transactions. Therefore, the future of these assets will depend on their ability to offer real value beyond simple financial speculation.
