Meme coin trading volume skyrockets despite market turbulence

Meme
tokens
are
defying
the
typical
market
downturn
behavior,
maintaining
their
position
as
some
of
the
year’s
top
performers,
according
to
a

report
by
research
firm
Kaiko.
Despite
a
recent
market
correction,
these
tokens
have
seen
year-to-date
returns
ranging
from
80%
to
1,800%.

Moreover,
meme
coin
trading
volume
remains
strong,
with
a
more
than
200%
increase
year-to-date,
totaling
around
$11
billion
weekly.

The
sustained
interest
in
meme
tokens
may
stem
from
their
adaptability
to
market
trends
and
accessibility,
which
continues
to
draw
substantial
community
engagement,
highlights
the
report.
Yet,
it’s
crucial
to
acknowledge
the
higher
leverage
meme
coins
carry
compared
to
most
altcoins,
often
fueled
by
speculative
trading.

In
an
interesting
twist,
the
correlation
between
meme
coins
and
other
speculative
retail
assets,
such
as
meme
stocks,
has
been
inconsistent
and
volatile.
For
example,
the
60-day
rolling
correlation
between
DOGE
and
GameStop
(GME)
has
generally
stayed
below
0.3
over
the
past
year.

Last
week,
meme
stocks
like
GME
and
AMC
Entertainment
saw
unexpected
gains,
which
led
to
a
spike
in
the
correlation
between
DOGE
and
GME,
marking
the
highest
point
in
over
a
year.

The
sudden
spike
in
GME
and
AMC
stock
prices
is
related
to
the
return
of
RoaringKitty,
one
of
the
key
figures
behind
the
GME
pump
seen
in
late
2020.

Crypto
liquidity
remains
divided
among
exchanges
and
assets,
with
Bitcoin
and
Ethereum
holding
the
lion’s
share.
In
2024,
Bitcoin’s
average
daily
1%
market
depth
was
over
$270
million,
dwarfing
the
liquidity
of
most
top
altcoins
by
more
than
tenfold.
Ethereum
followed
as
the
second
most
liquid
asset,
with
an
average
market
depth
of
$190
million.

However,
the
landscape
is
shifting.
Altcoin
liquidity,
in
comparison
to
Bitcoin’s
daily
market
depth,
has
been
on
the
rise
for
the
past
two
years.
This
change
aligns
with
a
decrease
in
Ethereum’s
liquidity
relative
to
Bitcoin’s,
dropping
from
83%
in
2022
to
72%
in
2024.