WTF is a meme coin?
In the ever-evolving landscape of crypto, one phenomenon that has consistently emerged across the market cycles has been the rise of meme coins. These digital assets have garnered the widespread attention of most crypto investors, enthusiasts, and speculators alike — some of the most popular meme coins have even gained enough attention to be reported in mainstream media.
In this article, we’ll explain what meme coins are exactly and why they are so popular.
What are meme coins exactly?
Simply put, meme coins are crypto tokens. Much like other popular assets such as Bitcoin (BTC) or Ethereum (ETH). However, unlike BTC and ETH, these coins often do not have any particular utility. They derive their value and popularity from internet memes and social media buzz which can be mimicked — like animals, artwork, characters or individuals.
Meme coins often have no traditional market fundamentals or technical innovations. Instead, they exist primarily as a form of digital expression or social experiment. Because of this, meme coins are considered as highly risky investments due to high volatility and uncertain intrinsic value.
But their investors don’t care. Meme coins are often portrayed to be fun and lighthearted, thus capturing the imagination of millions and driving a relentless force within the market, since they are designed to go viral and be shared around the community.
How did meme coins become so popular?
Dogecoin (DOGE) is one of the most popular meme coins to gain mainstream popularity. It also leads in terms of market capitalization within the meme coins category. Dogecoin started out as a lighthearted crypto token back in 2013 to pay homage to the original Doge meme featuring a Shiba-Inu dog. Dogecoin managed to appeal to a broader audience with famous “much wow” and “such tired” taglines, as compared to the more serious Bitcoin crowd.
Despite its origins, Dogecoin quickly gained popularity due to its huge and welcoming community, especially with the help of user generated content on platforms such as Reddit, Twitter and TikTok. Celebrity endorsements have also propelled the hype around meme coins into hysteria, gaining the attention of mainstream media.
Elon Musk, CEO of Tesla and SpaceX, often posted tweets with reference about Dogecoin back in 2020 — his tweets often had an immediate impact on Dogecoin’s price, driving its market capitalization to new all time highs at that time.
Meme coins also often have huge or uncapped token supply, resulting in very low value per token and are subjected to inflationary tokenomics. This particular design of tokenomics often resulted in a new wave of speculative investors due to low capital required to invest in for potential profits, thus making them more appealing to a broader audience.
How to trade meme coins?
On Bebop, you can trade some of the most popular meme coins such as DOGE, SHIBA or PEPE easily without slippage at the most competitive prices. You can also save network fees by swapping any token choice of yours into these meme coins using our multi-token swap feature.
What to keep in mind when buying meme coins:
- These tokens are highly volatile with rapid and unpredictable fluctuations which might result in substantial losses for investors who are not prepared for risks involved.
- Verify that the liquidity pool for meme coin are held by burn address to avoid buying a token that can potentially face malicious consequences, such as rugpull.
- Meme coins mania sometimes attract bad actors looking to capitalise on the hype and carry out pump and dump schemes; they will either artificially inflate token price with coordinated efforts or create new meme coins with low liquidity attracting inexperienced investors, only to sell their token holdings at the peak, resulting in substantial price drop after.
Conclusion
Meme coins have become one of the latest craze in the crypto world, captivating everyone’s attention with their blend of humour, community, and investment potential. While the rise of meme coins may be seen as a reflection of the changing nature of finance and investing in the digital age, it also serves as a reminder of the importance of understanding the risks involved and approaching these investments with caution.
Editor’s Note: The views and comments expressed in this article are for informational purposes only. We do not endorse any specific meme coins or cryptocurrencies. It’s important for readers to conduct their own research and exercise caution when investing in any digital assets, as any trades made shall be your sole responsibility.
