Tokenized Attention: Investment Thesis in a New Era of Assets

The role of memes in a digital world and how memecoins further financialize attention through tokenization — an investment thesis

Published in

Oregon Blockchain Group

12 min readMay 22, 2024

An investment thesis for $BODEN, written for Oregon Blockchain Group’s Venture Capital style investment fund. This is written by students for educational purposes, not financial advice

Analyst: Jordan Brewer

General Background on Protocol

In December of 2013, Jackson Palmer and Billy Markus created a token and blockchain called Dogecoin ($DOGE). Much to their surprise, it immediately gained traction on sites such as Reddit as a tipping currency. In a Satoshi-esc moment, the founders soon thereafter renounced ownership, and Palmer sold all his tokens as he did not want to support the speculation associated with the token. The Doge community stepped up and adopted it to continue using, buying, and holding the token. Over a decade later and DOGE is the 10th largest cryptocurrency by market cap and has inspired a new asset class of “memecoins” as Doge, Shiba Inu, Pepe, Dog Wif Hat, and Bonk account for 8% of the top 100 altcoins by market cap, excluding Bitcoin, Ether, and stablecoins. Jeo Boden ($BODEN) is a memecoin and will be the subject of this report.

Macro Factors Impacting Protocol

Memes have been a focal point of the crypto industry for a long time, ever since the inception of dogecoin in 2013. It is clear that this is still a prominent sector as seen in the YTD performance of different “narratives”. The YTD performance of memes has been 308%, followed by RWAs at 150%, restaking at 103%, then AI at 89%. In Q1 2024, altcoin season began to pick up as the Total 3 (market cap of all crypto excluding BTC and ETH) went from a low of $440 billion to a high of $788 billion. Over this time, memecoins accounted for a large amount of crypto trading volume. Solana is most well known for its memecoin ecosystem and saw DEX volume growth of 180% QoQ, largely fueled by memecoins. The newer Base L2 has also been home to many memecoins with a strong meme culture, which also saw immense growth in Q1 with a 478% increase in TVL over the quarter. The attention on memes has not been limited to cryptocurrency, either. On April 16, 2024 GameStop ($GME) was at a low of $9.95 per share before pumping to a high of $38.20 on May 13. This is reminiscent of GameStop’s original pump from $4.83 on January 12, 2021 to $120.75 on January 28, making it the first “memestock”. While the original pump was fueled by short squeezes, the resurgence in $GME further indicates an appetite for memes from market participants. It’s not just retail users that participate in memes, either. VanEck’s Bitcoin ETF ticker is $HODL, which is a well-known Bitcoin meme from 2013. BlackRock has also adopted memes with its BUIDL Fund, mimicking HODL. Franklin Templeton is another large institution that has adopted memes in the past, modifying its identifiable Benjamin Franklin profile picture to include the Bitcoin laser eyes. This goes to show that memes are powerful and go beyond individuals, but also hold weight among institutions. Furthermore, earlier this month VanEck launched a memecoin index, adding to the legitimacy of the asset class.

With EIP 4844, transactions on L2s have become almost free. The result is much higher trading volume which is what enabled Base, and the memecoins on base, to have such strong performance. In the same light, Solana has continued to maintain low transaction costs and high transaction speeds. This is important for meme trading as users rely on cheap and fast transactions to get in and out of positions quickly as well as allowing for smaller position sizes, catering to a wider audience. In addition to cheap and fast blockchains being important infrastructure for enabling memecoin activity, easy user experience (UX) and user interface (UI) is important to onboard people to participate in the memecoin casino. Phantom wallet has seen January YoY user growth of 220% as one of Solana’s fastest growing wallets among new crypto users, showing that key infrastructure that enables memes to grow continues to improve.

2024 is an election year for the US, where Joe Biden will once again go head-to-head with Donald Trump, capturing the attention of Americans and the rest of the world. In addition to the election driving attention towards these two political figures, crypto will no-doubt be a topic of discussion. Recently the Biden administration said that Biden would veto a piece of legislation allowing financial institutions to serve as crypto custodians, which in-turn made Trump a pro-crypto candidate.

Team

Not applicable.

General Auditing Background for Protocol

There are no security red flags on the $BODEN dexscreener page.

Specifics on the Project

Over the years, memecoins have been able to represent community in a variety of ways. For example, in 2014 the Jamaican 2-man bobsled team raised $184 thousand in $DOGE to fund their trip to the winter Olympics in Sochi, Russia. More recently, someone created a GoFundMe to put the Dog Wif Hat logo on the Las Vegas Sphere and was able to raise over $650,000. As illustrated in these examples, community and network effects play a large role in memecoins. Memes play a large role in the digital age as they are used to make jokes, communicate, and they bring us together. Taking this a step further, the market cap of a memecoin serves as a proxy for the amount of attention it has. For example, if a meme is more widely known, it will have a larger market cap, further adding to the importance of community in memes. Doge is a premier meme as it originally reached escape velocity in December 2013 when the dog picture went viral on Reddit (Figure 1). Due to its extensive history and meme-able nature where the doge image has a thought bubble with something written in Comic Sans, it is a widely known image. As a result, it is the largest meme by market cap at over $20 billion. This is to say that the doge meme is “valued” at $20 billion — a high value meme. The Mona Lisa is valued around $860 million, reflecting the amount of attention the painting has as everyone knows what the Mona Lisa is.

One of the scarcest things in the world today is attention. If something captures the attention of people, there is value in that. Memes capture the attention of internet users and if you are one of the first people to find a meme and share it, you get clout for that. Attention is valuable which is why advertisers will pay for attention, and tokenizing and financializing this is the obvious next step. Memecoins are the tokenization of attention.

Jeo Boden is a play on Joe Biden, the current and 46th president of the United States of America. This was a trend that started with Spoderman ($SPOODY) on Solana January 24, 2024. Spoderman topped out around $10 million in market cap on February 29, and has since died to around $100 thousand in market cap. Boden was launched on March 3, 2024 and peaked around $734 million on April 8, and has since died down to $155 million in market cap (-79%). Many tokens have launched under the same meme scheme with misspelled names of business or political figures such as Tooker Kurlson, Doland Tremp, Xi Jonpeng, Gery Goonsler, and Joram Poowel.

Narrative Sentiment

Besides the social importance of memecoins as a way to communicate, have fun, and build community, they are also honest in their intentions. Memecoins rip the mask off and say “this is what’s happening” instead of trying to disguise themselves as something other than cash grabs and a casino. Everyone that buys memecoins has a very clear understanding that there is no utility here and the buyer is betting that someone later on down the line will be willing to pay more for it than they did. For a long time there have been ways that people try to take other people’s money in the crypto industry. It started with ICOs in 2017, where founders would launch tokens claiming that they would change the world. Throughout the year there were 875 ICOs that raised $6.2 billion. This eventually evolved into coins with ponzinomics and weird DeFi elements where retail holders had their tokens locked and insiders and early adopters sold on them while they didn’t know what was happening. Then in early 2022, it was NFTs. People burned thousands of ETH in gas fees trying to mint the onchain pictures, only to find out they were being raked over the coals with 10% royalty fees and that a lack of liquidity can make it very difficult to sell NFTs without realizing substantial losses. Now there are low float high FDV tokens with early investors getting vesting token allocations that led to a peak $250 million in token unlocks in a single day in Q1 2024. To make matters worse, KOLs were shilling projects while having a token allocation that was unknown to retail, creating a situation where they don’t know what’s real anymore. Is this KOL only posting about this project because they have a token allocation and are waiting to dump on me? Memecoins remove all of this and are very clear in giving the impression that “this has no utility, it is strictly a joke” and the market forces playout as they will. A majority of memecoins have 100% of total token supply in circulation so there are no investor unlocks creating massive sell pressure and there is no one trying to convince people that this will change the world.

Why the Protocol Offering Matters to Consumers

Jeo Boden matters to consumers because it is a way to express the attention of the presidential election. Crypto is becoming more popular in the US, which also makes it more of a voter issue. As a result, there will be more attention on crypto related to US presidents. Donald Trump has issued his own NFT collection, and there is also a Donald Trump ($TRUMP) memecoin on Ethereum with a $400 million market cap. Many memecoins and crypto products surrounding Trump are more serious, rather than Boden which pokes at the president. This is what resonates with Americans. Biden is known for his disconnected speeches where he stumbles over his words and physically falling over. Furthermore, Biden was known for being memed on prior to the Boden memecoin with phrases like “lets go Brandon” and “sleepy Joe”. Another aspect related to Biden’s presidency that has recently changed the landscape is his stance on crypto. The Biden administration has openly disfavored crypto as it opposes passage of H.J. Res. 109, which would allow financial institutions to serve as crypto custodians. Both Biden and Trump will be memed in the election this year, however not in the same way. Biden cannot have a serious memecoin similar to Trump’s $TRUMP, in the same way Trump’s $TREMP has not succeeded as much as $BODEN, only being valued at $65 million. A “non-serious” Biden memecoin resonates with Americans more than a “serious” one, in the same way a “serious” Trump memecoin resonates more with Americans than a “non-serious” one and this is due to their inherent differences as individuals. Jon Charbonneau (@jon_charb) attempts to capture this in his tweet:

Community

Community plays a large role in the success of memecoins. The main two ways the community manifests is in attention to the token and KOLs. Attention towards Boden will begin to pick up again as the election race starts to speed up. Getting closer to November, there will be more discussion on the presidential election and thus there will be more attention towards election related memecoins. The combination of the election picking up later in the year in addition to a resurgence in altcoin activity could create the perfect storm for Boden to reach new all time highs. As is commonplace in crypto, positive price action will generate even more attention, creating a sort of fly-wheel effect where attention drives price, which drives further attention and the following price action.

The second manifestation of memecoin community is through KOLs. While memecoins often don’t have KOL rounds similar to traditional projects, prominent crypto Twitter (CT) accounts will adopt the project and begin shilling it to their followers. Typically a sign of success in a memecoin is whether or not key influencers are bullish on the token. In the case of Boden, one of the biggest crypto personalities, and perhaps the biggest in the Solana ecosystem, Ansem (@blknoiz06) is bullish on Boden. This can be seen in his reply to a post calling Boden a 10x on May 11th and in his response to another popular crypto personality Rookie (@rookiexbt) listing $BODEN among his other high conviction meme bets on April 7th. Ansem is prolific in the crypto industry with over 400k followers and a reputation for being consistently correct as seen in tweets from others and his appearance on the Crypto Market Wizards podcast. Prominent VC analyst Jon Charbonneau is also bullish $BODEN, however Ansem serves as more signal than Jon.

Qualitative Competition Landscape

Protocol Go To Market Strategy Versus Competitors

Many memecoins get launched, however only a few will reach escape velocity and have reduced risk of rapidly losing value. It appears as if Boden has reached that escape velocity, judging by its traction among CT influencers and its market cap sustaining over $100M market cap for over a month. $BODEN is also the highest market cap meme of Biden. Compared to all of the other memes listed in the table above, $BODEN is the only one with a clear catalyst driving attention to it in the future. $WIF has raised enough money to put something on the Vegas Sphere, but this is a much smaller attention grabber than the US election.

Investment Thesis

Memes are an important aspect in society today. They allow us to communicate, they serve as entertainment, they bring us together, and serve as social capital. We’ve seen not only retail users and individuals use memes, but also institutions with BlackRock’s BUIDL Fund and VanEck’s Bitcoin ETF $HODL. Memes are a proxy of the attention economy, and by extension, a tokenization of attention. Q1 2024 has shown degen appetite for memes and so has recent price-action in GameStop. Our current portfolio is underexposed to memecoins with memes making up 8% of the top 100 altcoins (excluding BTC, ETH, and stablecoins) which means any less than 8% portfolio allocation would indicate that we are bearish on the sector. Furthermore, this token will give us exposure to the Solana ecosystem, which we currently do not have.

With the US election coming up, attention will naturally gravitate towards Donald Trump and Joe Biden. $BODEN is a stronger meme than any Trump related memes as it is tokenizing a meme that already exists. “Let’s go Brandon” and “sleepy Joe” already poke fun at the presidential candidate as someone who is not very put together, and Jeo Boden accentuates this. The likelihood of a potential single catalyzing event is high, as can be understood from Ansem’s tweet: “operation get trump to call biden boden is in motion bros”. Heavy support from popular CT personality Ansem will continue to drive community adoption.

The token is down almost 80% in price from all time highs, and these all time highs were fueled by overall altcoin season rather than a native catalyst. The election in November will serve as a native catalyst, and this in combination with the potential of the markets heating back up after a period of cool off in Q2/Q3 2024 creates the perfect storm for the token to reclaim all time highs at the very least, which would be around a 5x return.

Lastly, investing in memes is a culture play. Memecoins are uniquely crypto and holding them as a part of our portfolio indicates that we are web3 natives, in the same way holding a Lil Noun does. With VanEck launching a memecoin index, BlackRock launching its BUIDL Fund, and Franklin Templeton putting the laser eyes on their profile picture, it is clear that memes and the attention economy are here to stay and this is something we should embrace.