Memecoins
What are meme coins? Is it worth investing? – Forbes Advisor
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If you look up the word “meme” in the dictionary, it is a funny image, video, or piece of text that is copied, usually with slight variations, and spread rapidly by Internet users.
Meme coins are not much different from the definition of meme described in the dictionary: they are nothing more than cryptocurrencies that internet memes and jokes have inspired.
Should you invest in meme coins? While some are classified among the the best cryptocurrencies by market capitalizationPotential buyers should understand that most meme coins offer little value and that some are outright scams.
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What are meme coins?
Meme coins are cryptocurrencies produced as a lighthearted joke. However, some meme coins have increased in value, reached multibillion-dollar market capitalizations, and gained celebrity endorsements.
While these characteristics suggest that meme coins offer some underlying utility or value, the truth is that almost all of them lack something like core value or unique use cases.
Instead, cryptocurrency investors often purchase meme coins to be part of a community or for entertainment value. The only use case for most meme coins is pure speculation.
“Meme coins are designed like any other cryptocurrency, like Bitcoin or Ethereum,” says Bryan Hernandez, co-founder of trading and investment platform Structure.fi. “The difference is that their existence tends to be centered around a viral moment or a fun idea, and their value depends largely on how much momentum that concept can generate.”
The original meme coin: Dogecoin
The original and most important meme coin is Dogemoneta (DOGE). Created in 2013 by software engineers Billy Markus and Jackson Palmer, DOGE was branded around a popular meme: the “doge” Shiba Inu dog.
The founders say they created Dogecoin to make fun Bitcoin (BTC). The name “doge” is a deliberate misspelling of “dog,” and the founders admit that they chose this name to ensure the cryptocurrency was “as ridiculous as possible.”
But in what would become a hallmark of other meme coins to follow, Dogecoin began to make a name for itself thanks to a fervent community of users, amassing something of a cult status.
For example, when the Jamaican bobsleigh team qualified for the 2014 Winter Olympics in Sochi, Russia, but was unable to fund the trip, the Dogecoin community came together to raise around $30,000 for the cause.
The story was picked up by major media outlets, helping to gain further investors and influence.
But it wasn’t until celebrities started endorsing Dogecoin that the price skyrocketed. The highest-profile promoter of the coin is Tesla CEO Elon Musk.
The enigmatic billionaire has continuously promoted Dogecoin. Musk also appeared in a “Saturday Night Live” skit in which he referred to himself as the “Dogefather.”
At its peak, Musk’s endorsement propelled Dogecoin to a market capitalization of $88 billion in May 2021 and became a pop culture phenomenon.
When a celebrity endorsement disappears, these cryptocurrencies can plummet. Today, Dogecoin’s market capitalization is worth just a tenth of its all-time high from more than a year ago.
Other popular meme coins
Dogecoin still serves as inspiration for meme coins. Since the launch of the original meme coin, more than 200 such coins have been created.
Shiba Inu (SHIB) launched two years ago as the “killer Dogecoin”. The cryptocurrency even mimics the Dogecoin brand as it uses the same Shiba dog. SHIB has also seen meteoric growth, reaching a market capitalization of $41 billion in October 2021.
Numerous other meme coins have been created in hopes of creating their own communities and sky-high valuations, but this year prices across the market have returned to normal, with meme coins among the hardest hit.
Dogecoin is down 60% in 2022, Shiba Inu is down 64%, while many of the smaller meme coins have fallen to zero and are being abandoned.
How do meme coins work?
The barriers to entry are extremely low for meme coins.
The open-source nature of the blockchain technology behind these cryptocurrencies means that creators can simply “fork” existing cryptocurrencies – essentially copying and pasting the underlying blockchain – and launch them online by changing something as small as the name or logo.
“A meme coin is simply a cryptocurrency, so it can be created easily with a few lines of code,” explains Tauhid Zauman, an associate professor at the Yale School of Management. “The coin can create its own blockchain or live on an existing blockchain.”
According to Zauman, meme coins are usually promoted by their creators on social media platforms to create initial hype and increase the price. After that, the price could continue to rise if the coin manages to create a strong community.
With the rising market The hysteria has pushed prices vertically across the market, many meme coins have been created to try and take advantage of this craze.
Should you invest in meme coins?
For every Dogecoin, there are many other meme coins that have left retail investors heavily underwater.
Dogecoin also fell 91% from its all-time high, while Shiba Inu fell 84%. Both still have market capitalizations of $8.7 billion and $6.5 billion, respectively.
Unlike Bitcoin, which has a maximum limit of 21 million coins, meme coins often have a high or unlimited supply.
There are more than 135.5 billion DOGE coins in circulation and every minute a successful miner receives around 10,000 DOGE, worth around $660. This is a staggering contrast in issuance volume compared to Bitcoin, where approximately 6.25 BTC are mined every 10 minutes, worth approximately $143,000.
Additionally, meme coins typically do not have mechanisms like “burns” that remove coins from circulation, so the number of coins in circulation continues to increase. Shiba Inu, for example, has more than 590 trillion coins in circulation, as of this writing.
Shiba Inu and Dogecoin are considered success stories among meme coins. The fact is, most meme coins eventually fade away.
“No one remembers the names of Dogecoin’s peers from 2013-2014, who now trade nowhere and have eviscerated untold amounts of speculators’ money,” says Jonathan Zeppettini, head of international operations at Decred.
“We tend to focus only on the winners and ignore the fact that those victories are extremes.”
While the evidence seems to be piling up against meme coins turning into the next Dogecoin or Shiba Inu, the silver lining and extreme “fear of missing out” was most evident during last year’s bull market hysteria.
But that doesn’t stop retailers from trying to get rich. It remains important, however, to consider them more as bets than investments.
“Most meme coins have gone to zero or failed to take off at all,” says Nick Saponaro, CEO of blockchain startup The Divi Project. “Meme coins should be considered a roll of the dice and those who invest their money in these speculative assets should do so on the assumption that they will lose everything they invest.”
Are meme coins safe?
Although memes are marketed as fun and lighthearted, there can be a dark side to cryptocurrency editions.
Not only are prices extremely volatile, with many meme coins dropping 99% or even to zero in the current bear market, but there are many accusations of foul play and bad intentions against the creators, who are often anonymous.
Zeppettini highlights several incidents where founders have been known to “create new coins, control 100% of the supply right out of the gate, and then focus solely on building hype so they can unload their inventory.”
“Buyers of these tokens may be unsuspecting retail participants who may not fully understand the underlying dynamics of the token in question but only see paid celebrity endorsements on social media or bot-driven activity that makes it appear as if the asset is trend,'” he says.
This isn’t the only concern. Many meme coins are often owned by a small group of people who own large concentrations of them. According to data from IntotheBlock, 48% of DOGE is controlled by seven crypto wallets. This number is even more evident for SHIB, where 69% of ownership is concentrated in 15 portfolios.
With such high concentration, a large investor could manipulate the market with their position or cause the price of the coin to collapse when they cash out their holdings.
Although making money with meme coins is technically possible, it is not a sure thing. These cryptocurrencies are subject to more volatile factors than traditional cryptocurrencies like Bitcoin and Ethereum, and the value of a meme coin can plummet overnight.
Amid speculation about Joe Biden’s future in the 2024 presidential race, memecoins tied to potential successors like Kamala Harris have surged, in contrast to the volatile trajectories of Biden-inspired “Joe Boden” and “MAGA” coins.
As the United States enters election season, it is becoming clear that both campaigns are using cryptocurrency funds and conversions much more than in previous years.
According to recent relationshipsThere is speculation that Biden is considering his future in the 2024 race, prompting traders at Polymarket to raise the odds of the Democrat exiting to nearly 80% on Wednesday, up from 55% previously.
This sudden increase follows a week of volatility in By Polymarket “Biden Drops Out of the Race?”, which has attracted nearly $10 million in bets. Before last week’s debate with Donald Trump, the odds of the same question were at 20%.
The White House has denied all rumors that Biden is considering withdrawing.
Memecoins
Memecoins associated with Joe Biden and Donald Trump have has undergone significant fluctuations in recent months. But these recent reports about Biden’s health have caused a surge in memecoins for his potential successors.
Joe Boden (EARTH) the currency has had a rather difficult six months. BODEN rose to nearly $0.80 in April before collapsing to its current price of $.035. This is a decline in value of more than 95% from its all-time highs.
The MAGA (BRISCOLA) has experienced similar volatility. It reached an all-time high of $17.37 in June before falling to its current price of $5.35.
Biden’s Replacement Memecoins
Over the past 24 hours, memecoins inspired by political figures who could replace Joe Biden, such as “Kamala Coin” (inspired by Vice President Kamala Harris) and “Buttigieg Bucks” (inspired by Pete Buttigieg), have seen a surge in market value.
Kamala coin (FUCK) increased by more than 110% last day.
According to CoinGecko data, another memecoin, “Gabin Noosum” (NOOSUM), is up 15% over the past 24 hours, and a coin inspired by independent presidential candidate Robert F. Kennedy Jr., the misspelled “Ruburt F Kenidy Jr” (KENIDY), has gained 10% over the same period.
Key points
- Solana meme coins have seen average returns of 8,469% YTD, far outpacing Ethereum’s 962%.
- Political meme tokens have emerged as a $784 million subcategory within the $57.7 billion meme coin market.
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Solana-based meme coins have significantly outperformed their Ethereum-based counterparts, producing an average return of 8,469% compared to 962% for Ethereum meme coins year-to-date. According to the “CMC 2024 H1” report, this contrast highlights a wave of speculative capital flowing into the Solana ecosystem.
Image: CoinMarketCap
The explosive rallies of WIF and BONK on Solana have attracted attention and capital from other chains, fueling a cycle of meme coin upside and further investment. While meme coins exist on multiple blockchains, Solana and Ethereum have dominated in terms of activity and trading volume.
Ethereum meme coins, typically launched in 2023 or earlier, have a more established presence. In contrast, most Solana meme coins entered the market in late 2023 or 2024, capitalizing on the recent surge in interest.
In particular, political meme tokens have emerged as a subcategory, with a total market cap of $784 million out of a $57.7 billion meme coin market. MAGA meme coin (TRUMP) has seen gains of over 5,100% this year, influenced by Trump’s vocal support for cryptocurrencies and acceptance of cryptocurrency donations for his campaign.
Image: CoinMarketCap
As cryptocurrencies become a hot topic in the U.S. elections in November, political meme-based coins will continue to attract speculative interest, CoinMarketCap’s report notes.
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19:18 ▪ 4 minute read ▪ by Mikaia A.
The memecoin world on Solana is buzzing with performances that exceed all expectations. Despite a rocky start, Solana has managed to turn things around and establish itself as a prominent leader in the meme cryptocurrency space, outperforming Ethereum by 800% since the beginning of the year.
Memecoin on Solana: Up 800% vs. Ethereum
Last April, the memecoin flame on Solana it seemed to trembleInvestors, disappointed by the poor performance and the recurring problems of some crypto memes, were starting to lose hope.
Top 10 Solana Cryptocurrency Memes – Source: CoinGecko
However, Solana decided to take the bull by the horns. Blockchain has undertaken a series of measures to address the problem of problematic memecoins and clean up its ecosystem. These efforts quickly paid off.
CoinMarketCap relationships from the first half of 2024 to prove that Solana-based memecoins have outperformed Ethereum by 800%An impressive performance that clearly illustrates Solana’s resilience and innovation.
Memecoins as Dogwifhat (WIF), Bonk (BONK) and Billy (BILLY) contributed to this success. Dogwifhat jumped 12.34% in just 24 hours, becoming the top meme coin on Solana. As for Billy, its market cap has risen 97% to $117 million.
These successes are explained by Solana ability to attract talented developers and create an environment conducive to the growth of memecoins.
Additionally, Solana has quickly adapted to the challenges posed by the meme cryptocurrency market, particularly by improving security and promoting transparency of transactions.
The Growth of Meme Cryptocurrencies on a Growing Blockchain
The growth of meme cryptocurrencies on Solana isn’t limited to a few isolated successes. It reflects a broader trend across the memecoin ecosystem.
With a market share of 9.64%, Solana dominates the industry, leaving Ethereum and other blockchains behind.
This dominance can be attributed to several factors. First, the Solana community commitmentwhich was able to mobilize significant resources to support and promote memecoins.
Secondly, Solana technological innovationwhich offers fast and low-cost transactions, thus attracting many developers and investors.
The successes of Dogwifhat and Billy illustrate this dynamic well. In addition to their impressive performances, these meme cryptocurrencies have benefited from massive community support and celebrity promotion.
For example, Ariana Grande shared a meme highlighting the cryptocurrency Michi, which led to an 18% increase in its value. These initiatives clearly show how Solana has managed to create an attractive and dynamic ecosystem for memecoins.
Finally, celebrity influence and increased capital invested in meme cryptocurrencies have also played a key role. Solana has been able to capitalize on these opportunities to strengthen its market position and attract new investors. Blockchain continues to record growth milestonessolidifying its status as a leader in the memecoin industry.
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Mikaia A.
The blockchain and crypto revolution is underway! And the day the impacts are felt on the most vulnerable economy in this world, against all hope, I will say that I was there for someone
DISCLAIMER
The views, thoughts and opinions expressed in this article are solely those of the author and should not be construed as investment advice. Do your own research before making any investment decisions.
The cryptocurrency world has recently witnessed a curious phenomenon: the rise of memecoins inspired by potential replacements for Joe Biden as the Democratic Party’s presidential candidate. In the last 24 hours, these digital coins have seen surprising growth, while the memecoin “Jeo Boden,” a parody of President Biden, has suffered a significant decline in value, falling by more than 30%.
The Memecoin Phenomenon and Its Connection to Biden
Memecoins are cryptocurrencies created as a joke or to pay homage to famous peopleInternet memes or cultural events. Unlike more traditional cryptocurrencies like Bitcoin or Ethereum, memecoins often have no intrinsic value or advanced technology behind them. Their popularity and value are largely dependent on social trends and current hype.
Memecoins inspired by political figures who could replace Joe Biden have seen exponential growth in the past 24 hours. Coins like “Kamala Coin” (inspired by Vice President Kamala Harris) and “Buttigieg Bucks” (inspired by Transportation Secretary Pete Buttigieg) have seen significant increases in market value.
This growth can be attributed to several factors. First, speculation that Biden may not run for a second term has created a wave of interest in possible Democratic candidates. This interest has been reflected in the memecoin market, where investors are trying to capitalize on the hype surrounding these figures.
Additionally, memecoins tend to be heavily influenced by social media trends. With names of potential candidates circulating on platforms like Twitter, Reddit, and TikTok, it’s no surprise that related memecoins have attracted the attention of investors.
The Decline of “Jeo Boden” and the Role of Social Media
In contrast, the memecoin “Jeo Boden” has seen a dramatic decline in value, falling by more than 30% in the past day. This decline can be interpreted as a reflection of investors’ diminishing confidence in Joe Biden’s political future. As speculation about his retirement increases, interest in a memecoin dedicated to him is decreasing.
Furthermore, the decline of “Jeo Boden” could also be a consequence of the memecoin market itself, which is known for its extreme volatility. Investors who had bet on “Jeo Boden” may have moved their funds to the new emerging memecoins, looking to profit from changes in the political landscape.
Social media plays a crucial role in the spread and popularity of memecoins. Online communities on platforms like Reddit, particularly subreddits like r/cryptocurrency and r/wallstreetbets, often serve as epicenters for discussion and speculation about memecoins. When a new meme or political figure goes viral, related memecoins can see a rapid increase in value.
Additionally, social media influencers and celebrities can have a significant impact. Tweets and posts from influential personalities can drive thousands of people to invest in a specific memecoin, further fueling hype and market volatility.
Final considerations
The rise of memecoins inspired by potential replacements for Joe Biden and the simultaneous decline of “Jeo Boden” highlights the unpredictable and volatile nature of the cryptocurrency market, especially memecoins. While these digital currencies can offer quick profit opportunities, they are also subject to drastic fluctuations based on social trends and political speculation.
For investors, it is essential to approach this market with caution, be aware of the risks, and not invest more than you are willing to lose. Memecoins are an interesting cultural and financial phenomenon, but like all trends, their value can be ephemeral and subject to rapid change.
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