How Fast Do Meme Coins Go from Launch to Collapse?

The celebration is short-lived, while the retreat is prolonged; the vast majority of coins do not reach a second peak.

Written by: Victor Ramirez

Compiled by: Saoirse, Foresight News

Meme coins are often associated with retail speculation and exaggerated high returns, but they have proven to efficiently bring traffic and liquidity to emerging public chain ecosystems. At the end of 2023, Solana experienced a resurgence after the FTX collapse, leading to a surge in meme coin trading; in 2024, the Base chain replicated this phenomenon; and recently, the Robinhood Chain has introduced a new play combining meme coins with tokenized stocks.

However, this viral and eye-catching nature also determines their short lifespan. Platforms like shturl.c and PONS have lowered the issuance threshold for meme coins, further amplifying this phenomenon. Millions of meme coins have been minted, but only a tiny fraction can land on centralized exchanges, and even fewer survive.

The cycle of meme coins skyrocketing and plummeting is well-known but rarely quantitatively studied. How long does the market cycle of meme coins last? In the long term, how do they actually perform? This report selects a large number of meme coin samples to measure their complete lifecycle from initial pricing to collapse, analyzing the meme coin sector from a macro perspective.

Using Survival Analysis Models to Study the Lifecycle of Meme Coins

To define the market lifecycle of tokens, this article sets three key events:

• Start: The token is first traded on an exchange
• Peak: The historical highest price (ATH) of the meme coin
• Collapse: A 95% drawdown from the historical highest price

This article employs the Kaplan-Meier estimator, a statistical method originally used in clinical trials to estimate the median survival time of subjects, to measure the typical market lifecycle of meme coins. The research sample is drawn from the Talos market database, consisting of 150 meme coins, limited to those issued after the launch of BONK in December 2023, following the rise of Solana meme coins.

Important note: This sample is biased towards relatively successful tokens; the inclusion criterion is that the coin must have generated market data on at least one centralized exchange. Many meme coins directly issued by platforms like shturl.c are not included. Therefore, the statistical results of this report will systematically overestimate the actual lifespan of ordinary meme coins. Additionally, the 95% drawdown is a human-set threshold, and the choice of threshold can significantly alter the calculation of median lifespan.

One more point: Comparing the current price to the historical highest price naturally skews the statistical results towards pessimism. Although the historical highest price can only be confirmed retrospectively, it still holds reference value; if local peaks are used as a benchmark, the uncertainty of price paths increases. Please consider this article as a demonstration of the analysis model rather than an absolutely precise statistical conclusion.

Meme Coin Lifecycle: Kaplan-Meier Survival Curve. Source: Talos CM Market Data Pro

Chart Reading Instructions: The estimator progresses from left to right over time. Each time a marked event occurs, it calculates the proportion of coins that have just collapsed among those that have not yet collapsed; then it multiplies the conditional survival rates. As long as the token is still within the observation range, it is included in the "risk sample denominator"; once the observation ends, it exits the statistics without being marked as collapsed. The curve starts at 100% and gradually steps down; the KM median value is the point where the curve crosses 50%.

Core Conclusion: After the first trade of meme coins, the median time to reach the historical highest price is only 17.2 days; a quarter of the coins peak in just 1.6 days. After reaching the historical high, meme coins take a median of 370 days to experience a 95% drawdown from the relative peak.

Investor Warning: Like a Casino, Meme Coins Have Extremely Poor Return Performance

The above section outlines the lifecycle from a temporal perspective; next, we analyze the return distribution of different meme coins.

The following chart shows the price distribution of each meme coin relative to its historical high: More than half of meme coins are currently down 95% compared to their historical highest price.

Meme Coin Current Price Relative to Historical Highest Price Drawdown Situation

Price Performance of Tokens Launched During the Solana Meme Coin Era

The vast majority of meme coins have concentrated initial return ranges, which then shift to a continuous decline; among 151 sample tokens, only 5 coins currently have prices higher than their launch day prices. After 300 days of launch, most tokens are left with only 10% of their initial value. Regardless of market capitalization, almost all meme coins struggle to escape negative returns. Among the five market cap coins born during the Solana meme coin era, TRUMP, PUMP, and PENGUIN currently have prices below their issuance prices.

Distribution of Duration at Each Stage of the Complete Lifecycle of Meme Coins

Among the meme coins launched during the Solana meme coin era, 50% completed the entire lifecycle from launch, reaching historical highs to a 95% drawdown within an average of 456 days. By the 1000th day, about 90% of tokens had fallen 95% from their peak.

The following Sankey diagram shows the final destinations of meme coins. Only 19% of meme coins manage to avoid a 90% drop from their historical highs. Among the 81% of meme coins that fell 90% from their historical highs, only 3% of coins have ever risen back to their historical highs.

Is This the Peak? Exploring Local Peaks vs. Historical Highest Points

When the market is soaring, how do you determine whether you have reached a local peak or an absolute extreme peak? This is unknowable, but historically, meme coins rarely create more than one "peak."

Two-thirds of meme coins from the Solana era do not experience a second rebound. They only rise once, peak within days, and never approach that price again. The remaining third of coins take an average of several months to reach historical highs.

Beyond Price: An On-Chain Activity Perspective

We can apply the same reasoning from the on-chain activity dimension for similar analysis. By counting active addresses on the Solana chain with balances of at least 1 USD, we compare the peak address count with the current level. The characteristics are highly similar to the price surge phase: on-chain activity reaches a peak without multiple local spikes; and after the first peak, on-chain activity is hard to recover. Currently, those "top" meme coins have less than 7% of active addresses remaining since their peak activity.

Data Source: Talos CM Network Data Pro

Outlook: Is the Era of Meme Coins Coming to an End?

Overall data presents an unoptimistic view of the meme coin market. Does this mean the speculative frenzy around meme coins has come to an end?

The current spread of meme coin trading across various platforms suggests the opposite conclusion. There is almost no evidence that the asymmetric returns of meme coins are meant to reward people for chasing extremely low-probability opportunities for wealth. However, if one assumes that meme coin speculation is based on rational market participants making prudent investment decisions, that would be a misplacement of categories. While the market is generally aware of the extremely poor long-term investment value of meme coins, it does not prevent a new batch of participants from continuously entering this game.

Speculative behavior is deeply rooted in market culture and is unrelated to the underlying trading infrastructure. Speculation is not a phenomenon unique to blockchain; rather, blockchain allows this type of market to expand efficiently and without entry barriers. As more assets become financialized and tokenized on-chain, various new speculative plays are likely to continue emerging in unexpected new forms.