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Meme Coins on the Rise – Is a New Bull Run Coming Led by Meme Coins?

EG 627 Meme Coins on the Rise Is A New Bull Run Coming

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Despite their age, meme coins are far from old news. For those who dabble in cryptocurrency, the term ‘Dogecoin‘ evokes a nostalgia of unexpected price surges during the bullish times of 2021. 

Today, however, the circumstances have changed. The crypto landscape is just beginning to regain its footing following a protracted bear market typified by sluggish growth. Usually, this would be a period where minor assets and meme coins find it hard to gain traction. Yet, paradoxically, meme coins are now taking flight.

The ascension of meme coins in 2023 may well portend a broader industry-wide optimism. An increasing number of investors are showing their readiness to shoulder more risk, plunging into small-cap coins and riskier assets, signaling a growing trust in crypto. But with the industry’s past marred by scams and pump-and-dump plots, the latest meme coin aficionados need to draw lessons from these historical blunders.

The rise of the hottest new meme coin – PEPE

PEPE coin, much like its meme coin brethren, does not carry any intrinsic or fundamental value, nor does it offer any utility. Being touted as the most “memeable” meme coin, it operates as an ERC token on the Ethereum blockchain.

PEPE coin emerged without the backing of an official team or roadmap, a simple tribute to the internet’s beloved meme character, “PEPE the Frog,” that gained fame in the early 2000s.

In spite of its recent launch in April 2023, PEPE coin has experienced an astounding surge of over 2,600% since its inception, catapulting it into the top 100 cryptocurrency projects based on market capitalization. As the PEPE’s official website states, “PEPE is a meme coin with no intrinsic value or expectation of financial return. There is no formal team or roadmap. The coin is completely useless and for entertainment purposes only.”

However, PEPE has been strategically positioned to piggyback on the popularity of fellow meme coins like Dogecoin and Shiba Inu. The primary distinction? While the latter are canine-themed coins, PEPE coin is a tribute to a frog.

Adding to its unique charm, PEPE Coin employs a deflationary mechanism that burns a small fraction of tokens with each transaction. This approach fosters scarcity and, over time, enhances the value of the remaining tokens.

Which other meme coins are on the rise? 

AiDoge

AiDoge is another innovative newcomer turning heads in the meme coin realm. By blending Doge with Artificial Intelligence, it has devised a platform that’s garnering attention from investors, with experts forecasting at least 300% gains by the end of 2023.

What sets AiDoge apart is its unique use case—an AI-powered meme generator that crafts memes based on user input. Users can churn out memes in large numbers in no time, riding the wave of viral social media trends. What’s more, AiDoge uses blockchain technology to provide exclusive ownership rights over the created memes.

In the AiDoge ecosystem, users employ its native ERC-20 token, $AI, to pay for credits needed to generate memes. $AI holders can also stake their tokens to earn daily rewards, and the more $AI tokens staked, the higher the rewards. As a decentralized platform, AiDoge empowers its community, granting $AI holders the right to steer the platform’s course and even incentivize meme creators with $AI tokens.

BabyDOGE

Deriving its name from the well-known Dogecoin, Baby Doge Coin was conceived by ardent followers of the Dogecoin online community. Despite its namesake, the resemblance between Baby Doge Coin and its “parent” ends there.

Constructed as a BEP-20 token on the Binance Smart Chain, Baby Doge Coin’s defining advantages lie in its superior efficiency and rapid processing speed. The result? Users enjoy diminished transaction costs and completion times as brief as five seconds.

Baby Doge Coin also incorporates an ingenious staking system designed to reward long-term holders (HODLers) by incrementally boosting the BabyDOGE count in their wallets with every completed Baby Dogecoin transaction. 

While it offers no practical real-world use, Baby Doge Coin’s allure stems from its commitment to charitable causes. According to its white paper, the cryptocurrency aspires to aid dogs in need and bring cryptocurrencies into mainstream use.

True to its pledge, Baby Doge Coin has donated to a plethora of organizations dedicated to dog welfare since its inception on June 1, 2021. The token’s journey has been a rollercoaster ride of sorts, with a staggering 2,800% surge within its first month, followed by a steep descent back to its initial price range. 

Nevertheless, the past quarter has seen Baby Dogecoin regain some of its lost ground with a 159% uptick in price.

DigiToads

Since Dogecoin (DOGE) burst onto the scene and entrenched itself within the crypto market, meme coins have showcased their resilience. They’ve proven to be more than just a passing trend, merging entertainment with actual utility, making them an intriguing proposition for investors seeking real-world use cases.

DigiToads exemplifies this novel concept. Drawing inspiration from the popular frog meme for its initial triumph, DigiToads now offers NFT staking and play-to-earn features in its metaverse known as ‘the swamp,’ an enticing amalgamation of entertainment and investment.

Within the swamp, players can nurture a young amphibian to adulthood, eventually competing with other characters for substantial rewards. DigiToads’ on-chain trading is entirely community-centric, offering opportunities to earn platinum TOADS that unlock premium features and even influence the project’s future direction.

The presale for DigiToad has raised over $4.8 million in just a few weeks, indicating the project’s potential. Their strategy allows early participants to earn more TOADS through a 10-stage coin offering where each stage increases the initial price slightly. Coin holders saw an average increase of 20% in the value of their TOADS during stage two

What are the risks of meme coins?

In the realm of meme coins, caution is the watchword. Data from 2022 revealed that nearly a quarter of new cryptocurrency tokens launched bore the hallmarks of a pump-and-dump scheme. In these scenarios, asset creators hold onto a substantial portion of the tokens, only to offload their shares when the coin value ‘pumps’, leaving the remaining holders with a ‘dumped’ value.

The frenzied hype surrounding meme coins typically gravitates towards tokens with smaller market caps, perceived as ripe for growth. Thus, many pump-and-dump schemes camouflage themselves as fresh meme coins.

It’s for this reason that potential investors need to exercise rigorous due diligence before considering a meme coin for their portfolio. If the meme coin in question is absent from major exchanges like Binance or Coinbase, that’s a red flag—these exchanges may have concerns about the coin’s framework.

Additionally, investors need to be wary of clone coins mimicking popular meme coins. Despite sharing a name or bearing striking resemblance, these could be entirely different projects.

Before diving into this novel and unpredictable market, investors should be mindful of the following dangers:

Volatility: Cryptocurrencies, in general, are known for their price volatility, but meme coins can be particularly unpredictable. Their prices are often driven more by social media buzz and speculative trading than by fundamental value. As such, the value of a meme coin can skyrocket or plummet abruptly and unexpectedly.

Lack of Intrinsic Value: Unlike traditional cryptocurrencies such as Bitcoin or Ethereum, which have underlying technology and use cases that give them value, most meme coins do not possess intrinsic value. Their value is primarily based on hype and the willingness of people to buy and hold them. Once the hype dissipates, the coin’s value could dwindle significantly.

Pump and Dump Schemes: These are common in the meme coin market. Here, large holders (often the coin’s creators) pump up the price of a coin, drawing in unsuspecting investors. Once the price has significantly increased, these holders sell off their coins, leading to a drastic drop in the coin’s value and leaving the new investors at a loss.

Lack of Regulation: The crypto space, in general, lacks the regulatory oversight seen in traditional financial markets. This makes it easier for bad actors to manipulate the market or run scams without facing significant consequences. Meme coins, given their popularity and novelty, can be especially susceptible to these issues.

Limited Adoption: Meme coins are often not widely accepted as a medium of exchange. This lack of practical use and limited adoption can negatively affect a meme coin’s long-term prospects.

Market Saturation: The success of coins like Dogecoin has led to an influx of new meme coins. This saturation could lead to investor fatigue, and it could be challenging for individual coins to stand out and maintain their value.

Illiquidity: Some meme coins have low trading volumes, making them illiquid. This means investors may struggle to sell their holdings when they want to, especially in large amounts, which can lead to significant losses.

Conclusion

The rise of meme coins signifies an evolution within the cryptocurrency landscape, highlighting the community-driven power and the sentiment-based market behaviors. However, this shift does not necessarily guarantee an impending bull run. Meme coins’ volatility is undeniable, and while they might offer significant potential rewards, they also carry significant risks. They often rely heavily on social media momentum rather than strong fundamentals or technological innovation, making them unpredictable and potentially transient. As such, investors should exercise due diligence, tread carefully, and never invest more than they are prepared to lose.

FAQs

What are meme coins?

Meme coins are cryptocurrencies that began as jokes or memes, like Dogecoin or Shiba Inu. They're typically characterized by their community-driven nature and viral social media presence, but they often lack the underlying technology or use case that other cryptocurrencies have.

Are meme coins a good investment?

This depends on individual risk tolerance. Meme coins can offer substantial returns due to their high volatility, but they also pose significant risks. It's crucial to do your research and only invest what you're willing to lose.

Why are meme coins gaining popularity?

Meme coins are gaining popularity due to their community-driven nature, their use in social media trends, and the potential for high returns. However, this doesn't necessarily equate to stability or longevity in the market.

Can meme coins cause a new bull run?

While meme coins have contributed to market enthusiasm and have occasionally influenced short-term market trends, it's uncertain whether they can trigger a sustained bull run on their own due to their inherent volatility and reliance on social sentiment.

What are the risks of investing in meme coins?

Meme coins carry substantial risks, including high price volatility, lack of intrinsic value or use case, and dependency on social media trends and sentiment, which can change rapidly.

How do meme coins differ from other cryptocurrencies?

Meme coins often lack the technological innovation or specific use cases that characterize many other cryptocurrencies. They are usually driven more by community sentiment and social media trends than by fundamental value.

Can meme coins become mainstream?

While some meme coins like Dogecoin have gained considerable attention, their long-term acceptance is still uncertain. It largely depends on whether they can develop use cases beyond just being a medium for speculative trading.

How does the community impact meme coins?

The community plays a massive role in meme coins' success. Their value often hinges on the community's sentiment and ability to generate hype on social media, which can drive demand and increase prices.

Can I lose all my money investing in meme coins?

Yes, like with any investment, there is a risk of losing your entire investment with meme coins. Given their high volatility and reliance on sentiment, their prices can decrease as rapidly as they increase.

What is the future of meme coins?

The future of meme coins is uncertain. While they have proven to be powerful market forces in the short term, their longevity will depend on factors such as regulatory developments, community support, and potential technological innovation or use cases.

Disclaimer. The information provided is not trading advice. Cryptopolitan.com holds no liability for any investments made based on the information provided on this page. We strongly recommend independent research and/or consultation with a qualified professional before making any investment decisions.

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Damilola Lawrence

Damilola is a crypto enthusiast, content writer, and journalist. When he is not writing, he spends most of his time reading and keeping tabs on exciting projects in the blockchain space. He also studies the ramifications of Web3 and blockchain development to have a stake in the future economy.

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