As an investor, you surely know all the top 10 most popular cryptocurrencies. You know what Bitcoin or Ethereum is. However, have you ever wondered what memecoins are and why they have become so popular in the crypto industry? In today’s lesson, we will answer these questions.
Memecoin – what is it?
Meme coins are nothing more than cryptocurrencies that are based or inspired on jokes, memes and viral online images. Hence, their name. Very often generated by creators as a joke, they are moving into the mainstream in the cryptocurrency world. On a large scale, they are not taken seriously, but over time they gain huge popularity, and their value increases. Cryptocurrencies based on memes are, for example, Dogecoin (DOGE), Shiba Inu (SHIB), Samoyedcoin or Doge Dash.
You have also probably noticed that the popularity of these coins is driven by famous public figures or internet celebrities. Some meme coins are typically a passing fancy for their author. They’ve been around for a few years now, but it’s estimated that the memecoin boom started at the end of 2020. That’s when the WallStreetBets community, on Reddit, significantly inflated the value of GameStop shares. In retaliation, another group of redditers pumped up the value of Dogecoin, and the trend took hold and, most importantly, has continued.
At this point, we must also mention Elon Musk, thanks to whom the popularity of DOGE has also increased a lot, but some meme coins are not just a funny joke. Floki Inu, also part of the meme coin canon, was created together with the Million Gardens Movement. It is a charity co-founded by Elon Musk’s brother Kimbal, but we will talk about the characteristics of this funny cryptocurrency later.
MemeCoins – characteristics
What do they have in common? Certainly, a high and sometimes unlimited supply. Unlike Bitcoin, for example, which is limited. They also very often do not have a ‘burn’ mechanism that burns them or removes them from circulation permanently. As a result, their number is constantly growing.
Their second common feature is their low price. Any investor can acquire numerous of them without consuming high monetary resources.
Ease of creation. There are many programs on the crypto market that will create such a coin for you from start to finish. You can redesign them in any theme to fit in with any trend.
They have no ecosystem to support them. They rely on their communities, which sometimes artificially pump up their popularity.
Investing
Investing in memecoins is very risky. Their prices are highly fluctuant and basically depend on the mood of the community, external factors or even celebrity tweets. Their price can rise to arbitrary values and then fall sharply. Outside the crypto world, they are often worthless. Nobody accepts payments in memecoins, but in popular cryptocurrencies, they do. We can conclude that in a few years nobody will remember meme coins any more and their value will be close to zero.
Let’s not harass them so much, though. Of course, you can invest in these coins, but you can never be sure of a profit. Proceed as you would with cryptocurrencies. Do thorough research before you invest in something. Never spend more than you can afford to lose.
Most popular memecoins (as of 04.10.2024)
Dogecoin (DOGE) – Created in 2013, Dogecoin is the most popular memecoin, having gained widespread recognition with the backing of Elon Musk in 2021. Its value then skyrocketed, with DOGE ranking among the top 20 cryptocurrencies in terms of market capitalisation. Dogecoin is an open-source digital currency based on a Peer-to-Peer algorithm, and its community actively uses and trades it.
Shiba Inu (SHIB) – Created as a competitor to Dogecoin, Shiba Inu made its debut in 2013 and quickly gained popularity with its mascot, the Shiba Inu breed dog. The SHIB ecosystem consists of three tokens: SHIB, Leash (LEASH) and Bone (BONE), adding diversity and functionality within its community.
Baby Doge Coin (BABYDOGE) – Operates on the Binance Smart Chain (BSC) and offers a passive income system for token holders. Thanks to the community and celebrity support, Baby Doge Coin has gained status as the third largest memecoin.
Floki Inu (FLOKI) – Floki Inu combines meme elements with practical applications, including DeFi and NFT. FLOKI is used in games and educational projects, and the cryptocurrency community is involved in charity work.
Dogelon Mars (ELON) – An Elon Musk-inspired cryptocurrency that is developing its applications in the areas of NFT and charity. It has more than 540 trillion tokens in circulation.
SafeMoon Inu (SMI) – Integrated with a passive income system, it rewards holders with a 2% sales tax. SafeMoon Inu is also developing a platform for blockchain gaming and NFT integration.
Dogwifhat (WIF) – Has become one of the most popular memecoins on the Solana platform, being the third largest memecoin by market capitalisation. Its community is actively involved in the development of the project.
You can find these and many more on our exchange!
Summary
The topic of memecoin is not complicated. You already know that it is a kind of cryptocurrency that was inspired by an internet meme or viral. By far the most popular of these is Dogecoin. They work similarly to most digital assets except that, unlike them, they are more volatile. Primarily because they are driven by their communities rather than being company or project-based. Most of them were founded on blockchain technology and are mined quite like the other, more established cryptocurrencies. Finally, we remind you that before you add any meme coin to your portfolio, do thorough research.
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