The Rise and Fall of Labubu: What a Toy Teaches Us About Markets, Memes, and Modern Fads #01

 The Labubu Empire: Fad or Fun? 

by Prometheus Capital

Few products in recent memory have captured cultural attention as strangely—and as quickly—as the Labubu, the eerie little vinyl creature produced by Kasing Lung and POP MART. What started as a niche designer toy became a global phenomenon, with collectors lining up overnight, resellers flipping figures for thousands, and social media turning the character into a full-blown aesthetic. If you had social media in the mid-2024 to late-2025 period, you just couldn't shake these little monsters. From memes to media, the Labubu has been represented and pushed to the forefront of our society as of late. The Labubu evolved from a simple plush to a fashion accessory and status symbol, with stars and celebrities like Rihanna and Dua Lipa being spotted with them. 

But like all meteors, Labubu rose quickly… and began falling just as fast.

Today, we’re taking a deep dive into how the Labubu craze happened, what its trajectory reveals about how fads shape the economy, and how social media transformed a collectible into a full-scale market event.

The Birth of a Cult Icon

Before Labubu went mainstream, it lived comfortably in the world of art toys—a niche community obsessed with limited releases, exclusivity, and creative design. Kasing Lung, the artist, built a strong reputation for whimsical but dark characters, each with a unique backstory.

POP MART, already known for capitalizing on “blind box” culture, saw potential.
They engineered the perfect formula:

• Low supply

Every Labubu figure had limited production. Blind boxes added randomness, fueling rarity.

• High demand

Cute, creepy, collectible—Labubu hit multiple audience segments at once.

• Social media virality

The design photographed incredibly well. Instagram and TikTok did the rest.

Labubu became a status symbol in the toy and streetwear community—something between an art piece, a fashion accessory, and a meme.

The Meteoric Rise: When a Toy Becomes an Asset Class

At its peak, Labubu wasn’t just a toy. It was an investment.

Collectors treated drops like IPOs.

Resale prices soared 10x, 20x, even 100x in some cases.
Limited releases behaved like scarce digital assets, with buyers refreshing apps like traders watching charts.

Why did prices explode so fast?

Behavioral economics gives us the answer:

• FOMO: The fear of missing out accelerates buying behavior.

• Bandwagon effect: If enough people want something, more people want it simply because.

• Anchoring bias: Once one Labubu sells for $5,000, the market begins anchoring future prices to that benchmark.

Suddenly, everyone—from toy collectors to casual TikTok teens—wanted in.

The Labubu boom mirrored historical fads like:

• Beanie Babies

• Sneaker drops

• Funko Pops

• Cryptocurrency NFTs

• Pokémon cards during the pandemic

But unlike those, Labubu had the advantage of being born in a meme-powered era. Through the power of social media, Labubu was allowed to gain a large platform and a ton of free advertising, which led to it staying in the media presence longer and thus garnering more sales.

The Fall: Why All Fads Eventually Collapse

The economic life cycle of a fad follows a predictable pattern:

Stage 1: Discovery

A small group finds something interesting.

Stage 2: Viral adoption

The mainstream pays attention.

Stage 3: Peak hype

Demand outpaces supply; prices skyrocket.

Stage 4: Saturation

Everyone who wants one… has one.

Stage 5: Collapse

Demand falls, resellers panic, prices crash.

Labubu hit Stage 5 when:

• POP MART increased supply

• The novelty wore off

• TikTok moved to new aesthetics

• Resellers flooded the market

• New collectors realized they were buying at irrational peaks

As supply rose and hype fell, the artificial scarcity disappeared.
Without scarcity, a collectible loses its investment appeal.

Labubu didn’t fully “die”—it simply reset to its natural demand level, the true size of its collector base. This sudden crash in sales and popularity grabbed the attention of many, from YouTubers to researchers, who all observed the "Labubu Phenomena"; they knew this was not surprising, as this is a trend set way before the Labubu was even conceived. To those surprised this would happen, they must not have been in touch with the media before; the saying "fifteen minutes of fame" is very real.

What the Labubu Craze Teaches Us About Business and the Economy

The Labubu phenomenon is more than a toy story.
It’s a powerful case study in modern consumer behavior and economic psychology.

Lesson 1: Scarcity is one of the strongest marketing tools on Earth.

When consumers believe something is limited, demand increases—even artificially.

Lesson 2: Social media can create markets out of thin air.

A meme today can be a billion-dollar product tomorrow.

Lesson 3: Consumers don’t just buy objects; they buy identity.

Owning a Labubu became part of people’s online personalities.

Lesson 4: Fads can stimulate real economic activity.

They create:

• reselling markets

• event lines

• retail waves

• influencer content

• secondary market platforms

even though the underlying product may be simple.

Lesson 5: Every hype cycle has an expiration date.

Companies that rely solely on fads must constantly innovate—or face collapse when the trend passes.

The Bigger Picture: Fads Aren’t Just Harmless Fun—They Reshape Modern Business

Today’s economy is increasingly driven by:

• viral trends

• meme cultures

• social proof

• Aesthetics

• Micro-communities

A product doesn’t need superior quality to win the market.
It just needs to capture attention.

Labubu succeeded because it was culturally contagious.

And it declined because cultural contagion always moves on.

For brands, creators, and investors, the lesson is simple:

In the age of the internet, attention is currency, but attention is never permanent, just like Labubu; all that matters is how you use those fifteen minutes.