Memecoins are kicking off 2026 with renewed momentum, as traders pile back into high-risk crypto assets. After ending 2025 near yearly lows, the memecoin sector has staged a sharp rebound, signaling a shift in market sentiment and renewed appetite for speculative trades.
Over the past week, the total memecoin market capitalization climbed more than 23%, rising from roughly $38 billion on Dec. 29 to $47.7 billion by Monday, according to CoinMarketCap data. This marks one of the strongest short-term rallies the sector has seen in months.
Memecoin Prices and Transaction Volume Explode
Leading memecoins all posted strong gains during the rally. Dogecoin (DOGE) rose more than 20%, Shiba Inu (SHIB) gained nearly 20%, and Pepe (PEPE) surged over 65% in just seven days. These double-digit moves highlight how quickly capital can rotate back into meme-driven assets when sentiment improves.
Trading activity also surged alongside prices. Memecoin transaction volume jumped from about $2.17 billion on Dec. 29 to $8.7 billion by Monday, representing a roughly 300% increase. The sharp rise in volume suggests that the rally is being driven by active participation rather than thin liquidity.
This rebound comes after a brutal year for memecoins. In 2025, the sector lost more than 65% of its value, bottoming out near a $35 billion market cap on Dec. 19 as traders pulled back from riskier investments.
Altcoins May Follow as Risk Appetite Returns
Market analysts say the memecoin bounce could be an early sign of broader risk-on behavior across crypto. Analysts at Santiment noted that the rally began shortly after fear, uncertainty, and doubt (FUD) peaked among retail traders in late December, reinforcing the idea that markets often move against prevailing sentiment.
Some traders believe this renewed interest in memecoins could spill over into other altcoins. A popular trader on X suggested that Solana could benefit the most, pointing out that meme-driven trading activity has historically boosted usage across the Solana ecosystem during past rallies.
While memecoins have led the charge, the wider crypto market has moved more slowly. Total crypto market capitalization increased just over 5% during the same period, rising from $2.97 trillion to $3.13 trillion. Bitcoin gained around 5% to trade near $92,400, while Ether rose roughly 7% to about $3,150.
Investor sentiment is also showing signs of improvement. The Crypto Fear and Greed Index recently flipped to “neutral” with a score of 40, marking its first neutral reading since October. If sentiment continues to recover, memecoins’ sudden resurgence could be an early indicator of a broader altcoin rally in early 2026.
