After the Solana Meme "Rush": Most callbacks exceed 70%, and liquidity bottlenecks have become the norm

24-05-14 14:25

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Original author: Smolresearcharc (summer period)

Original translation: TechFlow

A few days ago, @cryptowhail asked me an existential question at 5am: "Are we in an active period in the SOL market now?" This question got me thinking about how the memes on the SOL chain have performed since the fourth quarter of last year.

We looked at the data. This data comes from the SOL memes published by @CryptoKoryo through the Dune Dashboard in the past few months. It's a process of manually selecting memes and finding data, but I think we did a pretty good job.

We plotted current market cap (blue) vs. all-time highs (orange+blue) over the past few months:

November 2023: PEPE, WIF

December 2023: VONSPEED to POPCAT

January 2024: BLOCK to SOLAMA

February 2024: SNP to CHAT

March 2024: ACAT to BOME

April 2024: POOWEL to MANEKI

May 2024: BUNI to CRODIE

Some Observations:

· Breakout 3 It is difficult to break through 1 billion USD market cap, let alone 1 billion USD. Only WIF, MYRO, POPCAT, SC, BODEN, SLERF, BODEN, MEW, and BOME have successfully broken through.

· Currently, only WIF, POPCAT, and MEW (barely) have a market cap of more than 300 million USD. This shows how difficult it is to maintain a high market cap in this meme-saturated environment.

· Quite a few memes have an ATH of more than 100 million USD, but few can really maintain it. In addition to the above mentioned, we also have MYRO, SC (barely), BODEN, SLERF, and MICHI.

· Most memes have had huge drawdowns (see the ratio of orange to blue). Unfortunately, the data is skewed due to WIF and BOME, but the average drawdown rate from the highest point (ATH) for all memes is 72%. This shows that you have to chase winners very hard, or those with high liquidity (CEX liquidity like WIF, or new coins that don’t have much drawdown).

Notable pullbacks include:

· PEPE: -95% from ATH ($24m) - November 2023

· VONSPEED: -92% from ATH ($8.2m) - December 2023

· SILLY: -91% from ATH ($161.4m) - December 2023

· KPOP: -91% from ATH ($24.3m) - January 2024

· WYNN: -96% from ATH ($84.2m) - January 2024

· AMC: -91% from ATH ($10.6m) - February 2024

· ACAT: Down 91% from ATH ($8.3 million) - February 2024

· AABL: Down 93% from ATH ($54.7 million) - March 2024

· PENG: Down 93% from ATH ($213.8 million) - March 2024

· MIMANY: Down 92% from ATH ($44.2 million) - April 2024

· HAROLD: Down 93% from ATH ($58.9 million) - April 2024

· HOBBES: Down 97% from ATH ($132.6 million) - April 2024

· DEVIN: Down 98% from ATH ($14.9 million) - April 2024

· $100k) - May 2024

Interestingly, I would have thought the data would show us something like the following (cyclical decline), but there appear to be some outperformers (BOME has plenty of liquidity and insiders know it will be listed on Binance). Notably, no other memecoins are listed on Binance besides BOME and WIF.

What does the data really tell us?

1.It’s very hard to break through certain market cap levels: 30m/100m/300m, let alone sustain it after a big drop, it looks like this is still a trader’s market.

2.The drawdown from ATH has been brutal. An average 72% drawdown and an average 3% liquidity (compared to current market cap) means it’s hard to get your initial investment out if you joined at the top.

3.@cryptowhail’s comment about us entering the SOL meme active phase may not be as accurate as people think. For that we need to see more winners beating the likes of POPCAT or MYRO in April/May.

4. But for now, SOL is where your bet is. On-chain volume is rising. Pump.fun plus multiple memes launched daily on SOL means everyone is glued to their bots and wallet trackers trying to catch the next winner (which by the way looks like there are fewer winners unless you want to 2-3x). But we are in the trenches working hard for that miraculous 100x.