Along with the development of the Crypto market, a series of tokens have mushroomed, in addition to tokens with a mission to change the market such as Bitcoin and Ethereum, there are also tokens born just to create joy for everyone. That’s called meme coin. In fact, Meme Coin plays an extremely important role in the Crypto field and understanding its meaning can help increase their understanding. Through this article, Weakhand will help people better understand what a meme coin is and all about the strongest magnet of this crypto market.
Below are some articles that people can refer to to better understand the market:
- What is Bitcoin? All About Bitcoin
- What is Ethereum? All About Ethereum
- What is EVM? EVM Highlights
- What is Ponzi? Opportunities or Risks in the Crypto Market
- What is Rug Pull? How to Prevent the Risk of Rug Pull in the Crypto Market
What is Meme Coin?
Meme coin is a cryptocurrency that originates from funny and humorous images or content on the Internet. Usually these meme coins have no practical use or significant economic value and they are only created as a form of entertainment and scalping investment. By nature, meme coins have a large supply and include unlimited mints, which can lead to unstable values and high investment risks.
Today, the popularity of meme coins has increased significantly after a series of projects in this segment increased from several hundred to several thousand percent in just a few days. We can name a series of names such as SushiSwap, Dogecoin, Shiba inu, Pepe, LADYS,… these are all projects that have loyal communities.
Basically, all of us have to use social networking platforms, this is where the first meme images originate, not focusing too much on technology but only focusing on entertainment is a prerequisite. helps meme coin reach users and bring a number of new people into the crypto market.
The current market has up to several thousand meme coin projects, but not all projects are lucky enough to have the community and reputation to be listed on CEX exchanges, most of them are created for the purpose of rug pulling from users.
History
The first meme coin to be born and popular to this day is Dogecoin (DOGE), inspired by the meme dog of a smiling shiba inu dog. Created in December 2013 by two software engineers Billy Markus and Jackson Palmer.
Initially, Dogecoin was only created as a tease for Bitcoin (BTC). The word “DOGE” is an intentional misspelling of ”Dog” and the founders admit that they chose this name to ensure the cryptocurrency’s name was as ridiculous as possible, while also explaining why. They have a limited supply, however, they have quickly attracted interest and support from the crypto community.
It would be truly remiss to talk about Dogecoin without mentioning the connection with billionaire Elon Musk, as he continuously shows his interest and support for Dogecoin through posts on social network X (Twitter). Elon Musk’s tweets made a huge impact on Dogecoin value, in April 2021 he tweeted an image with the text (Doge Barking at the Moon) which caused Doge to increase over 100 times and reach ATH at that time.
In general, it should be noted that meme coins are often entertaining and have a high level of risk. Investing in meme coins should be done carefully and with a clear understanding of their risks and potential.
Mechanism of action
The operating mechanism of meme coins is not fundamentally different from other traditional coins, they are also often built on popular Blockchain networks such as Ethereum, BSC and Polygon. However some of them, typically Dogecoin have their own network designed for it.
In general, if these mene coins want to operate smoothly, they need to rely on the power of the memes they rely on to build, from there to have a strong, passionate community and then attract the attention of investors. another head. One of the other necessary factors is that these meme coins also need to have a strong marketing team to shill across social networking platforms to attract users.
Nowadays creating a meme coin is simpler than before and can be done by anyone, many cryptocurrency creation platforms have been born, providing the necessary tools and resources to create a meme. new coins. In addition, AI also partially supports meme token creation when it only takes a few minutes to code a coin.
The attraction of meme coin to investors
High price volatility: Currently, according to data collected by CoinMarketCap, there are a total of 3,481 meme coins available on the market. Of these, 20% of tokens have a daily trading volume of over 100,000 USD, proving that the community still supports projects in this field. In particular, meme coin also attracts most of the attention of investors due to its ability to suddenly increase in price just because of the saying of a famous Kols when they tweet about that meme coin token. These tweets have a very big impact. large to the price fluctuations of memecoins.
FOMO effect: Simply put, people see the rapid growth in a short period of time of these meme coins and people form a fear of missing out on opportunities, when they see everyone around them buying and they jump in to buy. Surname.
Myth about cheap prices: Instead of having to spend $38,000 to own 1 BTC or $2,000 to own just 1 ETH, when coming to meme coin, everyone only needs to spend $1 to have thousands of tokens in hand, with the ownership of many numbers. 0 behind the right sign, many people mistakenly think they are holding a bunch of cheap coins. The reason for this is that meme coins have a fairly large or even infinite supply of tokens and these memecoins also do not have a token burning mechanism, which makes their prices relatively low.
Potential and risks of meme coin
Investment potential
It is not difficult for us to find or hear stories of people changing their lives after playing memecoin. The popularity and high profits with small capital are what memecoin brings. Stories like investor When many traders hear these stories, it is easy to jump in and everyone’s money will bring profits to previous investors.
But it cannot be denied that meme coin is still one of the stories that is quite accessible to many people, it does not take too much time to learn about technology, just 1 token with a cute image. This will be a factor that is hotly discussed by the community and can attract many F0 investors to enter the crypto market.
Owning these tokens is similar to buying a lottery ticket. We will experience the feeling of “not knowing who is richer in a few hours”. In addition, owning these tokens also brings an interesting experience because it is also symbolic.
Investment risks
Everything has two sides. With huge profits, it also comes with a big risk. If x5 or x6 works, it can lead to everyone’s account being divided by 5 and 6. When participating in this sport, everyone will experience the feeling of “up and down” quickly. Saying so, everyone can imagine that their assets can be seriously damaged and need to be watched. Consider carefully before making an investment decision.
The lifespan of these meme coins is also quite short because they depend too much on the community and have no speculative value, so when the community no longer supports or leaves the project, the Dev team will not continue to develop. , creating a new meme coin is so easy, it only takes a few minutes so they can start a new project and have a new community, instead of staying with a project that no longer has a community.
In addition, meme coins are also fertile ground for scammers intending to pull rugs from investors. The fact that they are built and traded on DEXs forces investors to bet big or find hidden bets. gems must trade memes on here. DEX does not have any legal regulations, but most investors have to protect their assets. In the worst case, if the token is rug pulled, everyone is left with assets with a value of 0 and Can’t trade anywhere anymore.
Remember that in October 2021, there was a meme coin token inspired by the movie Squid Game (SQUID) shown by Netflix on its channel, pulled the rug and ran away with all the money, and the investors only knew sadly watching my money disappear.
Popular Meme Coins on the market
PEPE
Inspired by the famous green frog meme on the Internet, this is the important factor that makes this meme coin popular among the community that loves this meme. Although it was only officially launched on April 16, 2023, PEPE has achieved impressive numbers with a market capitalization of more than $1.6 billion. In less than 1 month, this token has increased. 6,000%. With the heat and ability to attract the attention of the community, PEPE has brought huge profits to its early investors.
Shiba Inu
Shiba Inu (SHIB) is a cryptocurrency built and developed on the Ethereum Blockchain according to the ERC-20 token standard. Inspired by the famous Japanese shiba inu dog, the project has created a buzz since its launch to the community, and is also a long-time rival of Dogecoin.
Initially, the developers used SHIB as a campaign to raise money to rescue abandoned Shiba dogs through the Amazon Smile program, but when they received strong support from the community, the project was truly built. seriously and then launched the ShibaSwap exchange, the SHIB token that promotes network development.
Floki Inu
Floki Inu (FLOKI) is one of the topics working on the next Shiba Inu dog house, the name of the project was named by fans after the Shiba dog of billionaire Elon Musk. Floki is a meme movement with a vision to empower the community. The Floki Inu community is also known as the Floki Vikings.
Besides, Floki is also one of the rare projects that seriously operates in building its own utilities in the DeFi ecosystem. Floki is also expected to compete with other emerging cryptocurrencies. available on the market.
Invest meme coin safely
Meme coins seem to have gone beyond the “jokes” they create as both potential and risks for investors, so people need to consider carefully before investing in them. this array. I will give you some ways to protect yourself when participating in meme coin:
You should only invest a small amount of money that people can accept to lose, meme coins always have a very high fluctuation value, it can completely turn the value to 0 and if people do not want to lose all their assets, they should Capital must be managed carefully.
Research the project carefully before investing:
- The development team is also one of the important factors that determine the success of a meme coin project. People should learn about the experience, expertise, and reputation of the development team.
- In addition, if a project wants to be seriously built, it also needs a roadmap that includes the goals, products and services that the project provides.
- If liquidity like meme coin receives the attention of a large community, the liquidity will be higher.
Summary
Above is all the information to help people understand what Meme coin is? And all about the Crypto market’s strongest magnets from Weakhand. Hopefully this article can bring everyone useful content.
