What are Memecoins? The Siphon Effect of the Memecoin Economy Amid Ethereum’s Dilemma

In 2025, the competition in the crypto market reached a fever pitch, and Meme coins have become an undeniable ecological variable. As Ethereum teetered on the brink of a value revaluation due to the Layer 2 war, and Solana rose strongly thanks to the Meme economy’s siphon effect, the market’s question of “what are some Meme coins?” became increasingly urgent. Based on real data such as the Ethereum Foundation’s sell-off, declining on-chain activity, and the Solana Meme economy’s explosive growth, this analysis examines Memecoin’s position and future in the ecological war.

Memecoin Ecosystem Overview: Traffic Restructuring from Solana to Ethereum

What are some meme coins? First, it’s important to understand the distribution characteristics of the leading meme coins. According to the latest data from DappRadar, on-chain meme coin transaction volume on the Solana chain surged by 36% in January 2025. Raydium, Jito, and Meteora, the three major DEXs, contributed over $309 million in fees, far exceeding Ethereum’s $46 million revenue during the same period. This difference is directly reflected in user behavior—Solana’s meme economy has restructured the crypto traffic entry point through low-barrier, high-liquidity meme coins (such as DOGE derivatives based on the dog theme), while Ethereum’s on-chain transaction volume plummeted by 38% to $36.5 billion in seven days due to high gas fees and Layer 2 fragmentation issues, while BNB Chain saw a 112% increase during the same period.

The rise of Memecoin is essentially a “traffic war” in the crypto market. Solana, for example, attracts Memecoin issuers with its high-speed transactions and low fees, forming a closed-loop ecosystem of “issuance-trading-holding.” While Ethereum’s Layer 2 solutions (such as Optimism and Arbitrum) alleviated mainnet congestion, they led to the fragmentation of ecosystem value—Rollup roadmaps hindered composability, and ETH value was “leaked” to L2 tokens and their operating companies. Curve Finance founder Michael Egorov bluntly stated, “L2 is more like a band-aid than a sustainable strategic foundation.” This fragmented state has put Ethereum at a disadvantage in the Memecoin battle.

Ethereum’s Dilemma: The Hidden Costs of the Memecoin War

The Ethereum Foundation’s (EF) sell-off has exacerbated market skepticism about its ecosystem. In January 2025, EF sold ETH three times, totaling 400 coins (worth approximately $1.28 million), causing ETH to fall by over 7% in 30 days. Although the foundation still holds 269,000 ETH (worth $817 million), the frequent sell-offs have shaken community confidence. More seriously, the decline in Ethereum’s on-chain activity contrasts sharply with the surge in Solana’s activity—DefiLlama data shows that from January 14th to 21st, Solana collected $71 million in fees (reaching $309 million including the three major DEXs), while Ethereum only collected $46 million.

This disparity is particularly pronounced in the memecoin space. Memecoin issuance and trading heavily rely on on-chain infrastructure, while the Ethereum Layer 2 wars have led to ecosystem fragmentation. For example, while Arbitrum and Optimism have improved TPS, users need to perform cross-chain operations, increasing friction costs. In contrast, Solana natively supports high-frequency Memecoin transactions, and Memecoin projects within its ecosystem (such as NFT+Memecoin combinations based on cultural memes) can quickly accumulate users. This difference in efficiency makes Memecoin issuers more inclined to choose Solana rather than Ethereum.

Layer 2 backlash: The life-or-death line of value reassessment

Ethereum’s Layer 2 solutions, intended for scaling, have unexpectedly become a “backlash” point for value reassessment. Justin Drake, on the X platform, called for “enabling native Rollup technology to end fragmentation,” while Paradigm research pointed out that Ethereum’s annual upgrade plan limited the speed of innovation response. This technological path dependence has led Ethereum into a vicious cycle of “innovation-fragmentation-value leakage” in the Memecoin war.

Specifically, Memecoin’s ecological value requires a fertile ground for “permissionless innovation.” However, in the current Ethereum Layer 2 ecosystem, the technical standards of various Rollup solutions (such as zkRollup and Optimistic Rollup) are inconsistent, requiring developers to adapt code for different L2 systems, increasing development costs. Simultaneously, users holding Memecoin must traverse multiple network layers, resulting in a fragmented experience. In contrast, Solana’s unified technical architecture and low gas fees allow for seamless integration of the entire Memecoin process from issuance to transaction, forming a “Memecoin as a service” ecological advantage.

Technical Analysis: The Price Game Between Memecoin and ETH

From a technical perspective, the rise of memecoins has a subtle correlation with the price of ETH. Coinglass data shows that ETH has risen in February every year for the past six years, with a 46% increase in February 2024 ($2280 to $3380). However, in January 2025, the price of ETH hovered around $3000, a 30-day drop of over 7%. Analyst Wolf believes that “ETH’s chart potential is unparalleled, making it the best asymmetric bet”; while Rakesh warns that if ETH breaks below the $2850 support level, it could further decline to $2400.

This price volatility is directly related to the siphon effect of memecoins. When Solana’s memecoin attracts a large influx of funds, ETH faces selling pressure due to its declining ecosystem competitiveness. However, the Ethereum Foundation has taken countermeasures: allocating 50,000 ETH ($165 million) to support the DeFi ecosystem and announcing a “major overhaul” of leadership to improve transparency. Vitalik Buterin emphasized that these reforms aim to “pave the way to a globalized, trust-minimized financial system.”

The Future of Memecoin: Key to Ecosystem Dominance

The answer to the question of “What meme coins are there?” ultimately depends on whether the ecosystem can translate its technological advantages into dominance. Ethereum needs to address Layer 2 fragmentation by achieving ecosystem unification through native Rollup technology. Simultaneously, it needs to learn from Solana’s experience with the meme economy, lowering the barriers to memecoin issuance to attract more projects. For example, Ethereum could launch a “Memecoin Fast Track” to simplify the issuance process and provide a low-gas-fee trading environment.

Furthermore, the sustainable development of memecoins must avoid being a “flash in the pan.” Ethereum can build a long-term value capture mechanism through innovative combinations of DeFi and memecoin (such as memecoin staking and liquidity mining). Solana, on the other hand, needs to be wary of the bubble risk from over-reliance on memecoins and must balance speculation and innovation.

In the memecoin war, Ethereum’s moat is being eroded. However, through technological innovation and ecosystem restructuring, it still has a chance to regain dominance. The key lies in whether it can transform the question of “What meme coins are there?” into a driving force for ecosystem innovation, upgrading memecoin from a “traffic tool” to a “value carrier.” As Vitalik said, “The convenience of permissionless innovation is the cornerstone of a globalized financial system.” In the future, the competition between Ethereum and Solana will revolve around Memecoin, and time will ultimately reveal who will win the ecosystem war.