The collision of culture and capital: Meme coins in this cycle and their star representatives

Starting from the previous cycle...

Since the last cycle of people, Shib, meme has been a cultural manifestation of a group. From a community perspective, the meme token is one of the symbols that best matches the sentiment and community atmosphere of retail investors. Let's recap the rise of people, where the original community was formed to win a rare copy of the U.S. Constitution Constitution at auction, the Constitution DAO attracted 17,437 contributors and raised over $47 million. PEOPLE is a token given to its contributors by ConstitutionalDAO to become a community-owned token after an auction failure. And in the process of raising funds and bidding through digital currencies, it connects groups who also agree with community autonomy and the federal constitution, and ultimately returns the right to organize to the community itself. This origin has given people a strong political color, and people coins have had obvious market performance in many political events since then. For example, during the election in the United States in June this year, people created a short-term increase of nearly 600%. Similarly, People's previous coin holding addresses and coin concentration also reflect that this is a "decentralized social experiment".

Since its launch in August 2020, Shiba Inu (SHIB) has become one of the most popular meme coins globally, thanks to its clever branding and strong community. The founder of SHIB, Ryoshi, locked 50% of the tokens on Uniswap during the launch, while the other half was transferred to Ethereum founder Vitalik Buterin's address. In May 2021, Buterin burned 90% of the SHIB tokens and donated the remaining portion to the India COVID-19 relief fund. This event attracted global media attention and propelled SHIB's market capitalization to over 40 billion USD in October 2021, making it one of the top cryptocurrencies worldwide. SHIB's market performance is particularly remarkable: it rapidly appreciated from a few million dollars in the early stages and even surpassed many well-established mainstream coins, becoming the object of millions of investors' pursuit.

The SHIB community ShibArmy is the core driving force behind its continuous development, with over 2 million participants active on social media platforms such as Twitter and Reddit, constantly expanding its influence. To further enhance the token's value, the SHIB team has launched the decentralized exchange platform ShibaSwap and issued tokens such as LEASH and BONE, forming a rich ecosystem. In addition, SHIB is developing the Layer 2 solution Shibarium to further improve transaction efficiency and enhance its practical application scenarios. This decentralized distribution mechanism, community drive, and ecosystem expansion have built a unique meme coin ecosystem. SHIB is no longer just a meme coin, but a community-driven project with real practical value, demonstrating the potential of meme coins beyond market sentiment and speculation.

In any case, whether it is cultural symbols or political symbols, DAO and meme coins have shown surprising effects in the market. Therefore, more and more people believe that DAO and digital currencies are naturally suitable for memes.

Meme style of this round cycle

BRC 20 and Inscription

In this round of market cycle, the meme coin craze presents some features that are completely different from before. With the surge in expectations for BTC ETF, Bitcoin-related tokens such as BCH have become the new destination for market funds. In addition, some designs that benchmark Ethereum have emerged in the Bitcoin ecosystem, such as BTC's Layer 2, EVM, and BRC 20 standard. The birth of BRC 20 has enabled the Bitcoin network to issue tokens and quickly attracted a large amount of capital attention.

In this context, star tokens in BRC 20, such as Ordi, have taken the lead in a strong rally, further fueling the hot market of BRC 20. Meanwhile, animal coins like Rats are also rising, taking the meme coin trend to new heights. Ethereum,

Other public chains such as Avalanche and Solana have also followed suit and launched similar tokenomic designs, allowing token projects to flourish on various chains, bringing diversity and innovation to the meme coin market once again.

Celebrity Effect and Special Events

In addition, meme coins are also greatly influenced by celebrities and some special events. During the US election, meme tokens around the Trump theme caused a frenzy in the cryptocurrency market. For example, meme coins such as 'MAGA', 'Super Trump Coin', and 'FreeDum Fighters' attracted investors' attention by using political events. In particular, FreeDum Fighters proposed the concept of 'PolitiFi' and launched a fictional duel mechanism supporting Trump and his opponent Harris ('MAGATRON' and 'Kamacop 9000').

Similarly, after Musk changed his social media profile to "Chief Troll Officer", TROLL and other meme coins instantly exploded in the market. The price of TROLL coin surged by 330% in just 24 hours, attracting a large number of speculators to enter the market. This move directly triggered a frenzy for TROLL and other meme coins, and many traders achieved huge returns in the short term by buying TROLL.

Along with the AI boom comes AI memes. Take GOAT (goatseus maximus) as an example. The concept of this token was created by an AI bot called 'Truth Terminal' and was introduced by developers using the Claude-3 Opus training model. The success of GOAT has led to the emergence of different AI meme tokens, such as SHEGEN, but they have not yet surpassed GOAT in terms of scale and influence.

Public Chain and Meme Ecology

Although Meme coins were initially mainly for entertainment or discussion purposes, they have played a significant role in driving user growth and the development of public blockchain networks in the crypto ecosystem. These tokens have attracted a large number of new users due to their high trading frequency, leading to the creation of wallets and an increase in transaction volume. For example, Ethereum became the preferred platform for launching meme tokens due to its ERC-20 standard, while Solana attracted a large number of meme coin users with low-cost transactions. The different characteristics and appeal of various public chains attract traders with different tones, thereby enhancing the user base and ecosystem exposure of the public chains. At this point, meme launchpads also emerged. Pump.fun is designed for user participation in creating and trading meme tokens. Its gamification mechanism and social interaction enhance the activity of the Solana ecosystem.

The mechanism of Pump.fun can be simply put as being able to release new meme coins with one click, and reasonably mint tokens through the bonding curve pricing system. The newly created memecoin will be directly sent to the raydium exchange, and when the market value reaches the limit, the platform will inject liquidity into raydium and destroy some tokens to enhance the liquidity and stability of the currency. For creators, only about 0.02 SOL initial fee and 2 SOL migration fee are required. These gameplay not only make Pump.fun a memecoin platform that is easy for project parties to cold start and participants to trade conveniently, but also make the Solana ecosystem more sticky and interactive.

In response to the frenzy around meme tokens, many public chains have also taken the initiative to accelerate transaction speeds and introduce new token standards. Blockchains like Solana even refer to meme tokens as "cultural tokens," emphasizing their important role in spreading blockchain awareness and promoting community development. All of this indicates that meme tokens can not only enhance network effects, but also attract new users through cultural dissemination. Subsequently, meme tokens may continue to serve as carriers of cultural dissemination and traffic entry points.

How did Meme Coin succeed?

Let's take a look at why meme coins are emerging in this cycle from a trading perspective. The most important reason is that other targets in the market that are in the low valuation range are not enough to absorb funds. Our ideal bull market is for ETH and BTC to "take off" with other altcoins, but most altcoins have not outperformed BTC's yield in this cycle; Secondly, the wealth effect of new projects is less than expected: the abundance of new projects has greatly dispersed market funds, and the valuation of the top new projects has been inflated in the primary fundraising stage, and began to fluctuate greatly after the subsequent IEO/IDO launch, so the return of small investors on the exchange is relatively average, and the sentiment of the anti-centralized capital game brought by these makes retail investors more willing to choose meme. In addition, the new narratives of this cycle such as intent, zk or FHE have not been recognized by most traders in the market, and most market participants will be skeptical, these narratives that do not currently see secondary wealth are still so far away, and the market is very much in need of new narratives that can be speculated.

From the perspective of meme itself, when inventorying successful meme coins, we can find that a good meme coin generally has the following conditions: The meme itself should have unique symbols and symbolic meanings, and have the potential for viral spread and secondary creation. Shiba Inu is a good example. Alternatively, the community as a whole has an inspiring story and vision, which stimulates emotional resonance within the community and encourages more users to identify and participate.

Secondly, operations are crucial to the success of memes. Achieving community autonomy at the beginning and forming a unified and consistent atmosphere through extensive communication. The founding team must be proficient in using publicity methods such as social media and various means to maintain user stickiness, ensuring that community members have the opportunity to participate in decision-making, enhancing cohesion and a sense of belonging.

The key point is that there must be a group of strong and stable market makers who are willing to support the project for a long time, thereby providing support for the coin price. The long-term trust and belief of these coin holders are important guarantees for the stable growth of Meme coins.

Is Meme Coin Hype or Self-Expression?

Control and Risk

As of recently, the total market value of the Meme coin sector is about $58 billion, accounting for around 2.5% of the total cryptocurrency market value. Despite having a certain position in the market, the overall scale is still relatively small. By the end of 2024, the top ten meme coins will occupy the majority of the market value in the meme coin market. Among them, Dogecoin (with a market value of about $11 billion) and Shib (Shiba Inu, with a market value of about $6.5 billion) are in a leading position. Including other popular meme coins such as Floki Inu, Dogelon Mars, and Baby Doge Coin, the total market value of these top meme coins accounts for over 80% of the total market value of the meme coin market, reaching approximately $39.7 billion in recent valuation. The meme sector presents a highly centralized phenomenon, with a few tokens holding a large market share. At the same time, due to the fact that some Meme coins are mainly held and manipulated by major holders, the overall volatility is significant. In the face of such a highly concentrated and volatile market environment, trading for profit has become a speculative and risky endeavor.

The balance challenge between innovation and value

The author believes that the most attractive value core of meme is the anti-orthodox expression: anti-mainstream narrative, anti-centralized capital...... It is a symbol that grows out of the communication of the community, and the expression carried by this symbol itself represents the individual expression of each participant in the community. However, meme and meme coins are two completely different things. Racking your brains to think of new narratives, new gimmicks, and then using celebrity effects or market making to drive the price of coins seems to be contrary to the essence of memes. Some argue that the meme coin is the most insignificant innovation in the crypto world, squeezing out a lot of block space and affecting the system of the blockchain itself; There are also people who think that hype memes are just a natural product, and it is also the meaning of crypto to guide the hype enthusiasm of the community reasonably. Regardless of what people think of meme coins, they are shaping the future of blockchain in unique ways and partly reflect the complexity and diversity of the digital asset market. In this context, how to balance innovation and value is still a question that the entire crypto community needs to ponder.

About MemeBox

MemeBox is a new brand under Gate.io that is dedicated to the prosperity of the MEME ecosystem, and will delve into the potential and opportunities of the Meme market. MemeBox is committed to integrating technology and culture, gathering Meme culture enthusiasts from around the world with an open and inclusive attitude, and working together to promote the new trend of Meme culture!

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