Conventional leveraged investment products have reached record highs, but appetite for speculative assets in the cryptocurrency market remains confined.
Speculative appetite among cryptocurrency investors is decreasing, and the dominance of memecoins compared to altcoins has reached its lowest level in almost two years, last seen in February 2024, According to to the CryptoQuant cryptographic data platform.
“Memecoin markets are dead,” CryptoQuant co-founder and CEO Ki Youthful Ji wrote in an X post on Thursday.
On the other hand, speculative appetite is growing among stock investors as customary leveraged exchange-traded funds (ETFs) hit a up-to-date record high of $239 billion in assets under management in the third quarter of 2025, according to data from Bloomberg Barchart chart.
This active signals waning enthusiasm for high-risk digital assets as speculative appetite returns to regulated TradFi leveraged products in less volatile equity markets.
The market dynamics signal a maturation in cryptocurrency and equity markets as risk-taking “is expressed through regulated, high-profile products with specific safeguards” rather than memecoins, which suffer from “weak” liquidity and regulatory uncertainty, Lacie Zhang, market analyst at Bitget Wallet, told Cointelegraph.
“A recovery would likely require a strong catalyst – such as a new viral narrative, listings on major exchanges, or decisive price action – to reignite retailer interest.”
Related: Bitcoin treasuries stalled in the fourth quarter, but top holders continue to accumulate sats
Cryptocurrency investor sentiment has yet to improve following the October market crash
Crypto investor appetite has remained confined for most cryptocurrencies since the record market crash in early October, not least for memecoin.
Cryptocurrency investor sentiment has seen a slight improvement from the “extreme fear” level of 10 recorded on November 23, but the current reading of 29 still signals “fear” and remains well below the “greed” level of 62 on October 7, before the $19 billion cryptocurrency market crash occurred. According to to CoinMarketCap’s Fear and Greed Index.
Meanwhile, the cryptocurrency industry’s best-performing traders in terms of returns, who are tracked as “smart money” traders on Nansen’s blockchain intelligence platform, are betting that leading Memecoin and most cryptocurrencies will fall.
Sharp money was net brief of Fartcoin (FART) for $3.5 million and net brief of Pump.fun token (PUMP) for $1.5 million, Nansen data shows.
However, the cohort is betting more on the upside for the Ether token (ETH) and the Hyperliquid decentralized exchange (HYPE), signaling a preference for tokens with blockchain protocols that generate real revenue.
Related: Crypto is approaching a “Netscape moment” as the industry nears a tipping point
The positioning of this cohort may also signal investor fatigue with memecoin launches in the previous cycle, as troubling data emerges about some of these coins.
On Thursday, blockchain data from Bubblemaps showed that about 30% of the Pepe token (PEPE) supply was tied to an entity that sold $2 million a day after the coin’s debut, calling into question the assumption of memecoin’s fair market launch.
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