Memecoins
do traders still make millions with the same coins?
Meme coins still generate profits, but not for everyone. Investors told crypto.news how much they were able to earn from the coin hype.
Meme coins posted an astonishing return of 1,313% on average in the first quarter. And this sector does not even think about stopping its growth, bringing traders millions of dollars in profits.
Source: CoinGecko
Huge positive price waves in a matter of days or weeks are natural. But what is it about?
What are meme coins?
Meme Coins are a type of cryptocurrency whose popularity is directly linked to Internet memes and viral social media marketing. Typically, they are initially created as a joke, without any practical function.
The first and most famous token was Dogecoin (DOGE), launched in 2013 based on the popular Shiba Inu dog meme. DOGE was initially intended to be a parody of Bitcoin (BTC). However, over time, this asset has gained a capitalization of a billion dollars.
The main difference between meme coins and traditional cryptocurrencies such as Ethereum (ETH) or Bitcoin is the lack of intrinsic value and issuance restrictions. Their cost depends entirely on demand in the context of the Internet boom, and because of this, meme coins are characterized by increased volatility.
However, recently there has been a tendency to give meme coins greater practical importance. For example, the developers of Shiba Inu (SHIB) and FLOKI are creating their own metaverses, NFT platforms and educational ecosystems based on these assets.
Million Dollar Profit: This Year’s Trend
The number of meme tokens issued increases with enviable regularity and traders manage to make fortunes from them. However, this success is generally short-lived and uncertain. In the long run, as the popularity of the Internet declines, the value of most meme coins tends toward zero.
Presumably, those making millions of dollars from meme tokens have inside information. Otherwise, how would these traders and investors know that the prices of certain coins would experience rapid growth? Crypto.news editors spoke with traders who could make a profit on condition of anonymity.
Frog Investments
The members of Pepe (PEPE) the crypto community celebrates the new all-time high for the frog token. In the midst of this, one user said he turned just $90 into $1.4 million thanks to PEPE.
In mid-April 2023, one trader purchased almost 6.5 trillion PEPE on the market. Uniswap crypto exchange just for fun. Since the initial investment amount was low, the trader did not sell the tokens and decided to monitor what would happen to them.
This decision turned out to be the most correct: in May 2024, 6.5 trillion PEPE made the anonymous trader a dollar millionaire. However, a user with the nickname Mina said that he had no plans to sell PEPE and now believed that one day the price of the frog coin would exceed $1.
“Sometimes I want to sell my PEPE, but I keep it to remind me not to rush. The meme coin market has not yet finished conquering the heights, and it is likely that my PEPE will make me a billionaire in a year.
Mina, anonymous trader
Strong belief in dogs and love of hats
A trader from the Meme Coin Telegram community shared an impressive story of winning on Dogwifhat (Wireless) piece of money. However, this case is different from the inspiring stories of traders whose coins increase 1000 times in an hour.
The anonymous trader used a different strategy: HODL. He purchased WIF in December 2023 and analyzed the overall activity on the Solana network and the growth prospects of the crypto market.
After weighing all the risks, the trader purchased tokens worth around $500, hoping for further growth. As a result, he earned around $15,000 just by keeping assets on his balance sheet.
“I’ve heard stories of traders making billions of dollars in profits starting with just $100. However, as an active participant in the crypto community, I find these stories to be the exception to the rule. The meme coin market is still very opaque and confusing, so inspirational stories about traders are likely simple insider trading.
Member of the Meme Coin community
More conservatism
Another member of the crypto community, nicknamed Andilet, urged caution when investing in meme coins and shared his asset diversification strategy. He advised dividing the crypto portfolio by risk level, with 10% of the portfolio consisting of high-risk volatile coins, including meme coins.
Despite the high risk, allocating a portion of the portfolio to meme coins seemed appropriate, as meme coins are more likely to generate significant profits.
“In general, it is difficult to predict in the long term how the meme market will behave, because in the case of memes everything strongly depends on the hype, the level of which is also difficult to predict.”
Andilet, SHIB investor
He invested in Shiba Inu in the summer of 2023, spending around $5,000 to purchase coins priced at $0.0000077. Now, with a SHIB rate of $0.000025, its assets are worth approximately $50,000.
“I think that in the case of the same corners, an individual approach to each project is important. We can guess the short and medium term trend by studying the project closely.
Andilet, SHIB investor
In summary: to invest or not to invest?
Investing in meme cryptocurrencies represents considerable risk. This can generate a solid profit through speculation, successful exit timing and total capital loss. The main thing is to monitor social media, read the news, be able to search for information, and the first time a media personality mentions a coin, try to get it.