Crypto traders flooded back to memecoins as the new year turned, driving memecoin market capitalization up by over 23% in the last week after trading at a yearly low in the final days of 2025.
The memecoin market cap crossed $47.7 billion on Monday, up from $38 billion on Dec. 29, according to cryptocurrency data platform CoinMarketCap.
The top three memecoins by market capitalization have posted double-digit gains in the past week. Dogecoin (DOGE) has gained over 20%, Shiba Inu (SHIB) has risen 19.9%, and Pepe (PEPE) has soared by over 65%.
At the same time, memecoin transaction volume has spiked, jumping from $2.17 billion on Dec. 29 to $8.7 billion on Monday, representing a 300% increase.
Memecoins fell more than 65% over 2025, bottoming at a market capitalization of $35 billion on Dec. 19, the lowest level of the year, as risk-taking behavior dropped among traders. Memecoins are among the riskiest bets in crypto, so their rally could indicate that investors are once again willing to take on more risk.
Altcoin rally could follow memecoins
Analysts with market intelligence platform Santiment said the memecoin bounce “began shortly after FUD was reaching its highest levels among retail traders, just a few days after Christmas.”
They added that markets often move in the opposite direction to expectations, adding that “As always, stay timely and capitalize on assets that the retail crowd has written off the most.”
Meanwhile, a trader on X posting under the handle Wealthhmanger speculated that altcoins could soon see a rally too as traders spread capital to other areas.
“When we see this kind of strength in meme coins, other altcoins usually follow. And historically, the altcoin that benefits the most from meme momentum is Sol,” they said.
Related: PEPE, BONK post double-digit gains: Are memecoins back?
Solana was a key ecosystem for memecoins during the last trading frenzy, and its usage rose and fell in line with memecoin-related activity.
Wider crypto market lagging behind memecoins
While memecoins have gone on a tear in the last week, the rest of crypto has lagged, with the overall market cap climbing more than 5%, rising from $2.97 trillion to $3.13 trillion.
Bitcoin (BTC) rose 5% in the last week, and is trading for around $92,335 as of Monday, while Ether (ETH) is up 7.3% to trade at roughly $3,168.
Overall sentiment is also improving. The CoinMarketCap Crypto Fear and Greed Index, a metric tracking crypto investor sentiment, flipped to neutral on Sunday for the first time since October, with a score of 40.
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