[Source- BNN Bloomberg]
Meme tokens are cryptocurrencies that use memes as mascots and tickers and have a humorous or viral aspect. Unlike Bitcoin and Ethereum, which have real-world use cases in digital transactions and decentralized applications (dApps), meme coins often have no specific purpose and represent only cultural value.
The first and most famous example is Dogecoin (DOGE). It was created as a joke in 2013 but has since gained significant popularity and a market capitalization of $22.2 billion (as of May 16).
Top 5 examples of meme coins that have stood the test of time
1. Dogecoin (DOGE)
DOGE was one of the first meme coins. It was launched in 2013 becoming the progenitor of all comic coins. DOGE is based on an Internet meme depicting a dog of the Shiba Inu breed. Palmer and Marcus created an open-source coin and their own blockchain based on the Litecoin fork.
DOGE quickly became popular owing to the efforts of Elon Musk. The billionaire repeatedly mentioned comic cryptocurrency in his posts on social networks, provoking a rapid memecoin rally. Recently, an option to use Dogecoin to pay for Tesla electric vehicles has appeared. Since its launch, DOGE has risen in price by more than 27,920%.
2. Shiba Inu (SHIB)
The memcoin Shiba Inu was conceived as a “DOGE killer.” The token was launched on the Ethereum blockchain in August 2020 by an anonymous creator who hides under the nickname Ryoshi. Like its older competitor, the SHIB was dedicated to a joke featuring a Shiba Inu dog, after which the asset got its name.
The meme token quickly attracted the attention of the crypto community, especially when Elon Musk and Vitalik Buterin began mentioning it. The latter received half of the entire memecoin issue from the SHIB development team, which was almost immediately burned. Buterin is also called one of the creators of Shiba Inu, but so far this theory has not been confirmed. Since its launch, memcoins have increased in price by more than 1,673,425%.
3. Dogwifhat (WIF)
WIF is another member of the Shiba Inu breed. At this time, a hat was placed on the dog, which is popular among developers. The name of the asset is translated as “dog with a hat” and it is intentionally written with a small letter — dogwifhat. Thus, the creators of the meme cryptocurrency seemed to emphasize its frivolous status.
Dog-themed members on the Solana blockchain were launched by anonymous developers in November 2023. Simultaneously, a coin appeared on the decentralized radius exchange. Asset liquidity at that time was only a few thousand dollars. WIF could have gone unnoticed by anyone if it had not appeared in the Binance and KuCoin crypto exchanges in January 2024. Subsequently, the asset began to grow, and its early investors became millionaires. A well-known case is how a trader who invested only $310 in dogwifhat received $ 1.4 million over a couple of months. Since its launch, memcoins have increased in price by 1,435%.
4. Pepe (PEPE)
Launched in April 2023 on the Ethereum blockchain, the PEPE cryptocurrency is dedicated to Pepe the Frog. Interestingly, the creator of the frog, Illustrator Matt Fury, calls himself a fan of the dogecoin.
The developers describe their coin as “the most meme memecoin in the world.” Perhaps, this was the reason for PEPE’s success of PEPE. Just a day after the launch, the rate of comic cryptocurrency soared by more than 900%. In the year since its launch, the assets dedicated to frogs have risen in price by more than 9,100%. As a result, early investors in memcoins turned their investments into millions.
One of the traders, in May 2023 purchased 5.9 trillion Pepe for just $250. A few weeks later, it reached $1 million. Such stories attracted PEPE’s attention of PEPE, lifting it to third place in the ranking of memcoins by market capitalization. However, the comic asset later pushed dogwifhat out of this place.
5. FLOKI (FLOKI)
The FLOKI memecoin owes its appearance to Elon Musk, who announced in one of his tweets that he had named his Shiba Inu dog Floki. Initially, the project was named Floki Inu and positioned as a deflationary. This means that coin holders make a profit by simply storing coins in their wallets. However, almost immediately after its launch in the summer of 2021, another dog-themed memecoin became a scandal.
The main developer of the project appropriates 20% of each transaction. After it became known about fraud, Floki Inu took over a crypto community called “Vikings’. They renamed the meme token FLOKI. Cryptocurrency is now positioned as a useful project, the task of which is to scale the use of digital assets.
Factors Contributing to the Success of Meme Coins
The success of meme coins can be attributed to a combination of factors that distinguish them from traditional cryptocurrencies.
One key element is the strong sense of the community surrounding meme coins. These communities are often vibrant, active, and passionate, drive engagement, and foster a sense of belonging among the holders.
Moreover, the use of memes as a marketing tool plays a crucial role in the success of meme coins because of their shareable nature and ability to quickly capture the attention of a wide audience, helping spread awareness and generate interest in these digital assets.
Meme coins lack intrinsic functionality, yet they present a potentially lucrative (albeit risky) investment opportunity that, with a strategic approach to investing, could yield significant returns by multiplying the initial investment many times over.
The primary aim of the investment is to purchase assets at lower prices and sell them at higher values. Typically, experienced individuals in the cryptocurrency space buy low and sell at high prices to retail investors, who are newcomers to the market seeking to acquire digital assets. The likelihood of new market participants purchasing meme coins, even those with questionable value, is notably higher compared to their likelihood of investing in L2 tokens that may be beyond their comprehension.
Challenges Faced by Meme Coins
Despite their popularity, meme coins face several challenges that affect their long-term viability.
One major concern is the lack of intrinsic value or utility associated with many meme coins.
Memecoins are just a funny picture of the Internet. Meme coins do not have any technology or fundamentals. Therefore, the value of any coin can either soar 100 times or fall 100 times It is just marketing and a picture of the internet.
In addition, not every meme coin is growing in value. More than 90% of meme coins are cheaper, and many people are only losing money.
Sometimes, it is much easier to win the lottery than to make money on meme coins. That is why you should always do your own research on the asset that you are willing to invest in.
Conclusion
The growth and popularity of memecoins reflect the interest in decentralized technologies and the cryptocurrency industry in general. However, with this growth, new challenges arise, such as the need to balance innovation and regulation to protect investors and preserve the industry’s reputation. The spread of memecoins also raises concerns about their impact on the maturity and integrity of the market as well as the appearance of tokens with negative aspects, which underlines the need for a responsible approach to the development of this segment. In general, the development of memecoins requires careful consideration by all market participants to create a sustainable and responsible ecosystem.
