The Complete Guide to Crypto Memes: Understanding Meme Coins

If you thought that social media trends strongly influenced popular cryptocurrencies like Bitcoin, Solana, and Ethereum, wait till you learn about meme coins.

With meme cryptos, the buzz is everything! Their rise and fall are entirely dependent on how much they’re being discussed in online spaces.

The exact mechanics of meme tokens, how they work in the broader cryptocurrency industry, and how to buy meme coins will form the bulk of this discussion.

So, what is crypto meme? Let’s dive in!

Introduction to Meme Coins

Meme coins are real-world jokes that have become tokenized on the blockchain. When jokes and memes trend on the internet for a while, all it takes is for some tech-savvy folks to make them into an actual blockchain token, and hey presto, you have a meme token.

While there are several meme tokens around, the one that most readily comes to mind is that of the Shiba Inu, which went on to become the mascot for Dogecoin.

If you’re ever inclined to invest in meme tokens, you should know that, just like regular memes, they’re highly subject to speculation. The more they’re talked about in online spaces, the higher their value.

Unfortunately, no memes or internet jokes will remain evergreen, and the long-term viability of meme coins remains uncertain.

The Evolution of Meme Coins: A Brief History

Meme coins, as we know them today, began with the launch of the Dogecoin in December 2013. While it started off as a joke involving other cryptos, using the ‘Doge’ meme of a Shiba Inu canine, the trend quickly caught on.

Soon, Dogecoin had its exuberant online community supporting it, and was well-known across the crypto market. What began as a social media trend had evolved into a fully functional, enthusiastic crypto community. Dogecoin would later reach its all-time peak of $0.74 in 2021.

Since then, other projects have been launched to varying degrees of success.

Key Characteristics of Meme Coins

Meme tokens generally originate from men or internet jokes and are thus heavily community-driven. Here are some of their characteristics:

Volatility

All cryptocurrencies are volatile, meaning that their prices often swing wildly to either end of the spectrum.

Meme tokens take the meaning of volatility to a whole new level, as their values are capable of experiencing unpredictable and rapid swings within short time frames.

Social Media Trends

Many meme coins, including Dogecoin and Shiba Inu, saw their values spike due to frenzied social media activity. In the case of Dogecoin, even Elon Musk got in on the act, prompting increased interest in the token.

With meme coins, social media influence is everything. If it’s trending, then you can expect its value to go up as well.

Market Sentiment

While the prices of most cryptocurrencies are susceptible to investor sentiment, meme coins are more vulnerable than most.

The price of a meme token can swing wildly due to market sentiment. All it takes for the price of a meme token to change may be something as simple as a tweet by the right influencer, and the shifting market sentiment can cause prices to go soaring up or tumbling down.

The Most Popular Meme Coins of 2024

Here are some of the most popular meme coins racing up the charts in 2024:

Dogecoin (DOGE)

What list of the top meme tokens would be complete without a mention of the premier meme coin?

Since its frenzied launch in 2014, it has built an enthusiastic user community and continues to be extremely popular among crypto investors.

Shiba Inu (SHIB)

The second largest meme token by market cap is named after the mascot that made Dogecoin so popular.

Since its launch, it has steadily grown to become one of the most easily recognizable tokens around. Its decentralized exchange, ShibaSwap, coupled with its unique tokenomics, makes it one of the most appealing meme token options for investors.

PepeCoin (PEPE)

Unlike Dogecoin and Shiba Inu, which were both inspired by a meme of a dog, PepeCoin opted for a different animal- a frog. The iconic Pepe the Frog meme is one of the most popular on the internet, and the PEPE project has continued expanding its base by focusing on digital collectibles.

The crypto project has also integrated innovation features like governance and NFTs, which is quite unique in the world of meme tokens.

BonkCoin (BONK)

BonkCoin is a popular meme coin known for its standout “Bonk” meme, which has gained popularity for its utility. The crypto project has a decentralized exchange called BonkSwap and a lending platform called BonkFi.

Through these platforms, BONK provides token holders with access to various financial services, which help it stand out in the meme token space.

The Mechanics Behind Meme Coins

What sets meme tokens apart from traditional cryptocurrencies is their general lack of utility. While a few projects are changing this narrative by including DeFi lending and other services, meme tokens have no other use except as tokens for transactions.

To understand how meme coins work, one has to start with how they’re created:

Early Stages

The first stage is conceptualization, where research and brainstorming occur. Here, the project’s founders are tasked with creating a name that matches a known trend and has a high chance of making the coin stand out.

Afterwards, it’s about deciding the purpose. While most meme tokens have none, if any, use cases, some new projects are adding some utility to draw more interest and investment.

Choosing the Blockchain Platform

The next step is to choose the blockchain platform based on the project’s goals. Some of the most popular platforms hosting meme token projects are the Binance Smart Chain, Polygon, and Ethereum.

The token is then created, and specifications such as distribution mechanisms, total support, and tokenomics are determined using a smart contract.

Project Launch

After the smart contract is prepared, the project raises funds through an Initial Dex Offering, Initial Coin Offering, or a direct listing on a decentralized exchange.

Part of the process includes launching liquidity pools, distributing tokens to early investors, and marketing.

Marketing is the trickiest aspect of launching a meme token project, as it determines its success. The idea is to get the social media buzz flowing on online communities like Twitter, Discord and Reddit.

A serious meme coin project relies heavily on brand and content marketing to generate the necessary buzz to attract potential investors.

How Meme Coins Gain Value

Meme tokens gain value through their capacity to go viral. Like an Instagram or TikTok reel trending for weeks or even months, meme tokens rely on virality for their prices to rise.

Blockchain founders and developers rely on the ability to create intriguing and relatable memes to maintain and expand the reach of their meme coins.

If a meme token gains popularity on social media platforms like Reddit, Twitter, or TikTok, more people become aware of it. With so many people aware of the token, you can expect the demand and trading volume to increase, ultimately driving up the price.

There’s also the crucial role that celebrity endorsements play, which can significantly boost the credibility and visibility of the meme token. Of all the famous people who have ever promoted a meme coin, Elon Musk stands out, with just a single social media action sending the value of Dogecoin soaring.

Another important factor driving the value of the tokens is speculation and FOMO (Fear of Missing Out). As prices start rising, more investors may fear missing out on potential gains and jumping into the market, further driving up prices.

Meme Coins: The Pros

Meme tokens are a unique digital currency that people invest in for different reasons. Here are some of the reasons people invest in them, as well as the potential benefits that entice investors.

Potential for High Returns

Meme tokens are a highly volatile asset, meaning that you can make a lot of money from trading them over a short period.

Early investors in popular meme tokens like Dogecoin or Shiba Inu, for example, saw substantial gains as these coins gained widespread attention and increased in value.

Cultural or Social Appeal

Purchasing a meme token is akin to getting in on the act. Many investors are keen followers of popular internet culture, memes, and trends because of the dedicated community of supporters that they attract.

People may invest in these tokens as a form of participation in a cultural phenomenon or to show support for a particular community or idea.

Low Entry Barrier

At the time of writing this article, Bitcoin is in the $60k range, which puts it well out of the range of newbie investors looking to invest only a bit of cash. The same applies to other established cryptocurrencies like Bitcoin or Solana.

With meme coins, the opposite is true. The low entry barrier allows more investors to participate, especially those who are drawn to the potentially significant returns with a relatively small investment.

Community Engagement

Another benefit of meme cryptos is that passionate and active communities often support them. Engaging with these communities can provide a sense of belonging and participation in a unique online culture.

For many investors, buying tokens like Dogecoin and Shiba Inu is more than just a potential financial gain. It’s also about the opportunity to be part of a trend. Community engagement provides them with a chance to network and learn more about tokens and other industry themes.

Meme Coins: The Cons