Memecoins
Crypto Expert Reveals How to Find “High Risk, High Reward” Meme Coins
May 10, 2024 12:26 p.m. | 3 minutes of reading
Pseudonymous cryptography researcher CryptoKoryoin his latest YouTube video, offered valuable information and strategies for traders looking to exchange coins.
What happened: The searcher strong points the potential of meme coins with stories of individuals turning $1,000 into a million dollars in a month. However, the reality is often different: many traders buy a coin thinking they are ahead, but they land at zero.
He cited the real-life example of someone who bought $600 worth of Pepe on the first day it was tradable, sold it the same day for a $60 profit, but could have made $9 million s he had held on.
He recommends combining two approaches to play the game well:
- Meme coins tend to perform better during specific periods, such as Q1 2024 and Q2 2023.
- Study parabolic movements and waves of adoption, as meme coins often experience explosive growth followed by sharp corrections.
It breaks down the adoption waves of meme coins into three distinct phases:
- First wave: Riskiest but offers the highest potential rewards, with early buyers positioned to make substantial gains. (Examples: Popcat, Grok, BOME)
- Second wave:More difficult, because traders must determine whether a meme coin will continue its upward trajectory or disappear. (Examples: dog hat (CRYPTO: Wireless), Pepe (CRYPTO: PEPE), Bonk (CRYPTO: BONK))
- Third wave: The least risky, because the same corner is already established. Potential returns are lower than in previous waves. (Examples: Dogecoin (CRYPTO: DOGE), Shiba Inu (CRYPTO: SHIB))
He cautions investors/traders of influencers and “shillers” who may have their own agendas, but not to completely ignore them, as they can provide valuable information.
Read also: DOGE is the ‘BTC of memes’ and these two coins are ETH and a ‘must have,’ trader touts
Why is this important: CryptoKoryo notes that trading meme coins requires discipline, patience, and a long-term perspective. “Don’t try to get rich overnight,” he advises. “Try to focus on longevity as a trader and getting a little better each time with each coin trade.”
In his coin story X post, the expert pointed out that the number of meme coins is too high and is increasing at a rapid rate, increasing supply, unlike 2021, where demand exceeded supply.
He notes two strategies: an all-chain approach in which the risk/reward ratio is high but the win rate is low. Alternatively, wait for a narrative to take over Crypto Twitter, thereby increasing the win rate but giving up some of the risk/reward.
Kroyo opts for a combination of both approaches, because among the thousands of meme coins, few will be profitable. Compared to meme coins in 2021, Koryo believes that “for the most part, it feels more like high risk and low reward.”
And after: The influence of Bitcoin as an institutional asset class should be explored in depth in the next The future of digital assets event on November 19.
This content was partially produced using AI tools and was reviewed and published by Benzinga editors.
Image: Shutterstock
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