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Memecoin Rally Sparks Market Caution

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The memecoin sector has staged a dramatic reversal, with its dominance ratio surging from historic lows as total capitalization reclaims the $50 billion threshold. Tokens like PEPE, BONK, and FLOKI have led the charge with double-digit gains, signaling renewed speculative interest in this high-risk segment after a year of steady decline.

However, underlying wallet metrics suggest this rally may represent a dangerous trap rather than sustainable growth. The abrupt nature of the recovery, coupled with concerning on-chain data, indicates potential market manipulation or short-term speculation rather than fundamental strength. Investors should approach this resurgence with caution, as historical patterns show memecoin rallies often precede broader market corrections.

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