When coins with dog or frog faces suddenly post huge price gains, you know it's memecoin season. Of the 100 most valuable cryptocurrencies, six memecoins are currently shaking up the sector - more than ever before. Past rallies show that the window of opportunity for profit-taking is small and the risk of total loss is high.

Investors in memecoins generally do not assume the long-term success of the project. This is because, as with other crypto projects, concrete use cases are often lacking here. The focus is much more on short-term gains. And those can be exuberant, especially in a bull market. The past few weeks have shown that they are exuberant.

Top 6 books nearly 2,500 percent gain

Dogecoin, Shiba Inu, Pepe, Bonk, dogwifhat and Floki: there are more memecoins in the top 100 most valuable cryptocurrencies than ever before. Together, they have increased in value nearly 2,500 percent in the past 30 days. The biggest winner: dogwifhat. Over the month, the Solana-based coin rose more than 800 percent to its current price of $3.36. New market capitalization: just over 3.3 billion USD.

The coin is followed by coins Floki and Pepe, securing the silver and bronze medals in the monthly chart with price gains of 556 and 473 percent, respectively. Behind come Bonk and Dogecoin with "only" 123 percent price growth each.

In the past 24 hours, the sector's market capitalization has risen nearly 8 percent overall, highlighting the high level of investor interest in memecoin projects.

Memecoin rally: the beginning of the end?

However, the green price figures are not the only indicators that speak in favor of the start of the memecoin season. Data analytics platform Santiment states in a blog post: At the beginning of the month, the trading volume of loose memecoins increased by an average of 3,000 percent.

However, the upward phase may offer bleak prospects for the rest of the market, says Stefan Lübeck. "In the past, escalating memecoin prices signaled the end of sector rotation of money through the crypto market and heralded a correction," says the BTC-ECHO market expert. In the last bull market in 2021, the rally around Dogecoin and Shiba Inu lasted only a few months. When that ended, Bitcoin plummeted and shortly thereafter the rest of the crypto market. Could this phenomenon repeat itself now?

"At least not in the near future," says Lübeck. For that, the price increases of memecoins are currently too low. "Compared to Doge and Shiba Inu in 2021, we are probably only at the beginning here," the market expert continued.

Lübeck sees one factor that could completely break this correlation in Bitcoin spot ETFs. If investment interest here remains high, the negative impact of a memecoin sell-off could be milder.