Investment products in traditional finance are experiencing unprecedented levels, yet interest in speculative assets remains low within the cryptocurrency sphere.
Crypto investors are showing diminished interest in speculation, with the dominance of memecoins over altcoins reaching its lowest point in nearly two years, a level last seen in February 2024, according to crypto analytics firm CryptoQuant.
“Memecoin markets are lifeless,” commented CryptoQuant co-founder and CEO Ki Young Ji in a post on X on Thursday.
Conversely, equity investors are exhibiting a rising appetite for speculation, as traditional leveraged exchange-traded funds (ETFs) reached an all-time high of $239 billion in assets under management during the third quarter of 2025, according to Bloomberg data shared by Barchart.
This trend indicates a declining enthusiasm for risky digital assets, as investors’ speculative inclinations are shifting towards regulated, traditional financial leveraged products in more stable equity markets.
This market dynamic suggests a maturation of both crypto and equity markets, as risk-taking is now “expressed through regulated, familiar products with defined safeguards” rather than through memecoins, which face challenges like “thin” liquidity and regulatory ambiguity, according to Lacie Zhang, market analyst at Bitget Wallet.
”A resurgence would likely require a strong catalyst — such as a fresh viral trend, significant exchange listings, or definitive price movements — to rekindle retail interest.”
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Crypto investor sentiment still recovering from October market crash
The interest of crypto investors has remained subdued for the majority of cryptocurrencies since the significant market crash at the beginning of October, affecting not only memecoins.
Although crypto investor sentiment experienced a slight recovery from the “Extreme Fear” level of 10 recorded on Nov. 23, the current score of 29 still indicates “Fear,” significantly lower than the 62 “Greed” level observed on Oct. 7, prior to the $19 billion crash in the crypto market, according to CoinMarketCap’s Fear & Greed Index.
Meanwhile, the industry’s top-performing traders, identified as “smart money” by Nansen’s blockchain intelligence platform, are betting against the leading memecoins and most cryptocurrencies.
Smart money took a net short position of $3.5 million on Fartcoin (FART) and $1.5 million on the Pump.fun (PUMP) token, as indicated by Nansen data.
However, this group is positioning for more gains in Ether (ETH) and the Hyperliquid (HYPE) token, indicating a preference for tokens associated with genuine revenue-generating blockchain protocols.
Related: Crypto nearing its ‘Netscape moment’ as the industry approaches a pivotal point
The actions of this group may also indicate investor fatigue regarding the memecoin launches from the previous cycle, as alarming data is surfacing about certain coins.
On Thursday, blockchain data from Bubblemaps revealed that roughly 30% of the Pepe (PEPE) token’s initial supply was held by an entity that sold $2 million worth the day following the coin’s launch, raising questions about the memecoin’s fair-launch narrative.
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