Memecoins
From Dogecoin to SHIB: the rise and resilience of Memecoins in crypto
Love them or hate them, there is no escaping memecoins. The impressive gains boasted by top dog and catcoin traders regularly make headlines, fueling FOMO (fear of missing out). It would be easy to dismiss memecoins as a fad if not for their persistent growth and growing share of the cryptocurrency market.
When a respected figure like Vitalik Buterin feels compelled to comment, by publishing a treaty advocating for “higher quality, fun projects that contribute positively to the ecosystem and the world around them,” it attracts the attention of the few remaining industry watchers who weren’t already keeping an eye on memecoins. The growing popularity of these assets is attracting talent and user activity to the space, as Underlines by Bitmex CEO Arthur Hayes in May.
Now everyone is watching and many are trading them. The question is: are memecoins the natural evolution of crypto or a last resort for desperate players looking for a quick win?
At the beginning there was one
Just as there was initially only one cryptocurrency – Bitcoin – there was once only one memecoin: Dogecoin. Started as a joke by Billy Markus and Jackson Palmer in 2013, it quickly gained a cult following, but it wasn’t until 2021 that memecoin mania truly took off. That year, Dogecoin reached a market capitalization of $85 billion, surpassing several of the largest 100 American companies.
As expected, a slew of other memecoins followed, each attempting to dethrone Dogecoin. If none has yet succeeded, some have come close, notably $SHIBwhich is currently located just outside the crypto top 10. Memecoins are now a $56 billion industry with popular tokens such as $PEPE, $WIFand $FLOKI regularly records daily volumes that exceed everything except ETH and BTC.
The appeal of Memecoins
From a consumer perspective, the appeal of purchasing memecoins is obvious: their high supply and low unit price make them seem affordable to retail investors, while their accessibility simplifies the acquisition process. The record returns achieved by holders of top-performing memecoins also far exceed those of traditional assets like BTC. For example, $WIF has surged 185,498% from its lowest level five months ago.
But beyond just speculation, there are several reasons why memecoins are now the face and future of crypto.
The closest thing to a fair launch
There is a case to be made that memecoins are among the fairest cryptocurrencies ever created. Their acquisition does not require technical skills or specialized equipment; you just have to believe in the potential of the token. Even if the odds are stacked against the buyer, identifying a piece with the right attributes – memes, community, content, uniqueness and that certain je ne sais quoi – is an underrated skill.
Even for those without the ability to identify a gem among the many simultaneous launches, there is still money to be made by purchasing already successful memecoins. There’s a reason memecoins like $PEPE are hitting all-time highs while serious DeFi assets are down, even in a bear market: distribution.
The main characteristic of memecoins is not their high supply or low unit price; it’s their fair launch that gets everyone in on the ground floor. Memecoins stand in stark contrast to low-float, high-fully diluted value (FDV) “VC coins,” whose charts often show perpetual decline. With the launch of memecoin, no one – except perhaps a few insider wallets – has an unfair advantage. This is the ultimate PvP (player versus player).
Rather than venture capitalists and influencers selling them to retail investors, it is often retail investors who force professional investors to buy their assets after realizing that memecoins are not a passing fad but a class of sustainable assets. There is no such thing as a completely fair launch, but memecoins come close.
Retail investors aren’t the only ones interested in high-supply tokens. From the perspective of crypto exchanges, AMMs and DEXs, memecoins are very beneficial, increasing transaction volumes and increasing protocol fees. Issuing a memecoin has now become the default way to launch a new DEX or layer2, much like christening a new ship with a bottle of champagne.
Protest money for the people
Looking at new tokens traded on platforms like Cielo or the latest Solana tokens funded on Pump Fun, it is clear that most memecoins are high on hype and low in originality. By the time you read this sentence, around ten memecoins will have been launched on the EVM and Solana chains. By the time you finish this article, half of these parts will have failed. It’s a reality: 99% of all memecoins will be worthless.
However, the same can be said for many “serious” cryptos that claim to have real utility and support. Whether in DeFi, GameFi, or RWA, the charts are filled with tokens that peaked shortly after launch and have been in decline ever since. At least with memecoins, people accept these risks, knowing that their value depends on the memes and the energy of the community.
The fairness of memecoins also extends to their creation. Thanks to the many token-as-a-service launch platforms, anyone can now create and issue their own token with no technical skills required. This allows tokens to be spontaneously issued to commemorate the latest news or latch onto the latest popular meme.
Memecoins represent protest money for the people: a way to fight against those who hold power and wealth. In a space where ideas are judged on their merits, memecoins offer a voice to the voiceless and opportunity to the excluded. Successful memecoins, reaching billion-dollar valuations and top-tier exchange listings, are the crypto equivalent of underdogs who fought their way to the top through sheer grit.
Often simple and short-lived, memecoins nonetheless represent a unique opportunity for outsiders to succeed. Plus, they add a fun element to the crypto space. In a world where humor is increasingly regulated and open discussion is discouraged, memecoins remain a bastion of free speech. No matter how popular the concept may be, no one can stop a token from launching, thanks to the power of permissionless blockchains.
We may not like them all, but we can’t deny their place in crypto. Memecoins are here to stay.