Shift in Cryptocurrency Investment Trends

According to Ella Zhang, head of YZi Labs (formerly Binance Labs), the cryptocurrency market is experiencing a shift in investment trends, with funds moving from memecoins back to fundamentally stronger altcoins.

Zhang observed that the momentum of memecoins has waned due to their lack of solid foundations. Community-driven discourse initially created a more accessible entry point for investors, but the sustainability of these assets is now in question. He stated, “From the end of the first quarter, people’s interest in venture-backed tokens began to fade, while the popularity of memecoins surged, leading to the so-called memecoin craze.”

Platforms like Pump.fun and similar initiatives have transformed early-stage altcoin investing by enhancing accessibility, transparency, and community engagement. They primarily focus on memecoins, experimental tokens, and community-driven projects, allowing nearly anyone to launch and trade new crypto assets.

However, Zhang pointed out that this trend has begun to reverse in recent months. Despite the ease of accessing memecoins, their fleeting popularity has prompted investors to realign their focus on venture-capital-backed altcoins. “According to CoinMarketCap data, this trend is now slowing down. The ratio of memecoin market cap to non-memecoin altcoin market cap is decreasing, indicating that funds are gradually flowing back into non-memecoin coins,” he explained.

Zhang emphasized the importance of fundamental value in sustaining any asset. He asserted, “For any asset to have enduring or increasing value, it requires one or more core services, businesses, products, technologies, or new innovations that will drive price increases. Without fundamentals, value cannot be maintained.”

*This is not investment advice.