Is the party over for meme coins?

• Meme coins have lost about 30% of their value in the past month following bearish sentiment from potential Bitcoin headwinds.
• WIF is down more than 61% from its recent all-time high of March 31.
• Crypto market may have passed euphoria level as celebrity meme token launches soak up liquidity from top meme coin projects.

According to Santiment's data on Thursday, meme coins have experienced steep declines in the past few weeks, following speculation that the crypto market has passed its euphoria phase.

Meme coins erase three-month gains

The crypto market has sustained increased bearish pressure in the past week following the German government's offloading of its seized BTC. The potential supply shock from Mt. Gox BTC creditors' repayment has also had telling effects on the market, with meme coins taking a major hit.

In the monthly time frame, all the top meme coins except BRETT and MOG have lost more than 30% of their value. The Santiment chart below shows that these coins are on track to erase gains spanning the meme coin frenzy from March into May.

Meme coins price perfomance

Dogwifhat (WIF), which led the Solana meme coin frenzy earlier in the year, is down more than 61% from its March 31 all-time high of $4.83. The number one meme coin, DOGE, has decreased more than 50% from its yearly high of $0.2202. Shiba Inu, the next biggest meme token, is also down 57% from its yearly high.

As the meme coin bloodbath continues, most in-the-money investors are contemplating whether to take profits, while out-of-the-money investors are considering cutting their losses as hopes for a bullish reversal dim.

IntoTheBlock's data shows more than 70% of DOGE, PEPE, and FLOKI traders are still in profit despite the recent decline.

Meanwhile, crypto analyst @Ali_charts suggested that the bull cycle may be over as the market may have already hit the euphoria phase and is now reaching a stage of complacency. Some other traders also share the same sentiment, advising investors to book profits or cut their losses before a further decline.

If this is true, then meme coins could be set for more decline.

The reduced growth of top meme coins can also be traced to the popularity of Solana's token generation platform, Pump.fun. Most traders may have rotated capital from top meme coins into the plethora of celebrity meme coin launches that hit the market in the past few weeks.

On a lighter note, the recent decline in meme coins may be considered a normal move due to their high volatility. During market growth or downturns, meme coins are usually the most affected, often rising or declining in multiples of the general market's movement.

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