How Memecoin became a billion-dollar company

From the beginning of this year to now, in just 10 months, the total market value of Memecoin has reached $54.5 billion, and the "meme coin super cycle" has begun.

1. Come from the community and go to the community

For a long time, Internet culture has occupied an important position in the field of cryptocurrency. From zoo cats and dogs to celebrities, people's recognition of these symbols has gone from curiosity and fun to identification, which takes time to accumulate.

Meme has a low threshold, and the number of users accumulated over a long period of time in the bear market and the cultural precipitation of meme have reached a certain height. The NFT community players who were popular in the past two years are an important cornerstone for the development of meme, and community attributes are undoubtedly ranked first.

Whether it is old Meme coins such as DOGE and SHIB, or rising stars such as PEPE and WIF, or NFT OG projects such as Cryptopunks, and NFT head projects such as Pudgy Penguin and Azuki that continue to explore the field of IP operation, they have laid a strong and united community for the development of meme. And one of the reasons why these former NFT players can quickly integrate into the Meme coin after starting to play is that a good project, whether it is the community atmosphere or the cultural aesthetics, is relatively consistent. Whether it is like-minded or like-minded, it is always possible to play together to form a community.

Although the successful memecoin is issued in one second, it is not famous overnight.

Take Pepe for example. Pepe can be traced back to Matt Furie's comic "Boys Club" in 2005. The most classic line is "feels good man", and later there was the sad frog "feels bad man". In 2008, Pepe became popular on the 4chan forum and was made into various emoticons. Around 2014, Pepe basically covered all mainstream social media. However, Pepe was later given some political metaphors and encountered a lot of controversy, which also made Pepe's image very complicated; in 2017-2019, Matt Furie and the Pepe community were committed to getting back to the source and trying to get Pepe back to its origin and original intention.

In April 2023, Memecoin PEPE was launched, and early on it was driven by forces from the NFT community such as Milady NFT holders and Chinese in Dubai. Although PEPE was much later than DOGE in the history of tokens and there were some debates, PEPE eventually became the third largest Memecoin after DOGE and SHIB.

At the same time, some investment institutions also expressed their recognition of the power of the community. On July 9 this year, A16Z's official Twitter interacted with Truth Terminal and paid Truth Terminal $50,000. GOAT comes from an OPUS large language model Truth Terminal, whose training data comes from websites such as reddit and 4 chan. Basically, it is trained based on extreme subculture content. It is designed to debate AI-generated belief systems and combine Meme elements. As of now, the market value of GOAT tokens has exceeded $300 million, with a 24-hour increase of 133%.

2. The viral effect that KOLs hope for

Not only users in the Meme community will hype, but celebrities will also spontaneously hype. After seeing the release of $Trump, there are reports that the Biden campaign team plans to hire a meme manager to try to win the support of young voters. Whether it is zoo symbols such as dogs, cats, mice, monkeys, frogs, pandas, penguins, or celebrities such as Kanye West, CEO Brian Amstrong, Steve Aoki, Snoop Dogg, etc., they are all common images and visual symbols of Meme coins, especially the Meme content that combines the images of Trump and Pepe, which has been used as his campaign material.

It is worth mentioning that the Trump family's crypto project WLFI has exceeded $10 million in sales. WLFI started selling on October 15, offering a total of 20 billion tokens. 14 hours later, 687 million tokens were sold, worth about $10.3 million. Etherscan data shows that there are 6,832 independent wallet addresses holding WLFI, which is currently lower than the more than 100,000 registered users announced by the project team the day before the token was released.

Why is meme more popular now?

Because Meme has better liquidity than NFT and is a more viral cultural carrier. NFT images are limited, but the spread of Meme is unlimited. Meme coins are basically issued in the hundreds of millions. A good meme coin can spread to hundreds of thousands or even millions of people in just a few days or even hours. However, no matter how hard an NFT project tries, the target audience can only be limited to a relatively limited small circle. Thousands or even tens of thousands of people are already the impact level that can be achieved by the top projects. And because the price of NFT is rising, trading is not as convenient as DEX, and not everyone can own and spread it.

One ​​big difference from NFT is that meme coins will get attention regardless of good or bad news.

For example, Solana Ecosystem Meme Coin Project SLERF, after the founder destroyed the liquidity pool due to operational errors, it attracted great attention from the crypto community, and thus made "Oh, Fuck" a famous meme for a period of time, leading the coin price to break through $1, an increase of more than 50%, and quickly logged into many mainstream exchanges.

In other words, the Meme coin project cares more about "whether more people pay attention" rather than "whether this thing is good or bad".

3. The surge in Meme "feeds back" the user group and transaction volume of the main chain: small leverage leverages large returns

In August this year, Tron stood out in the market fluctuations. Thanks to seizing the Meme craze (the launch of SunPump, etc.), the Tron-based meme coin SUNDOG continued to soar, rising from US$0.002 to US$0.20 in a few days. (This wave of Tron and SunPump first went viral because of the violent pull of $Sundog that day, which pulled the price from the inner market to 70M, thus attracting a lot of attention, and players also entered the market one after another, and the chain became active, and even led to a new high in Tron network revenue. This is a typical "small horse pulling a big cart.")

TRON's price rose by 23.1%, and its market value increased by 22.7%.

Here we have to mention a wealth-creating effect.

The reason why Meme has developed into a mainstream track now is that it easily creates wealth, and the FOMO (fear of missing opportunities) panic of missing opportunities must be mentioned. On the one hand, the market is pulled up to convince people, on the other hand, the myth of wealth creation is promoted, such as so-and-so earning 30 million US dollars in two hours, and on the other hand, the community spreads fomo fear, which is also a common marketing method of meme and is also in line with the law of communication.

4. Thinking: Memecoin may be a strategy for blockchain products to enter the market the fastest

The traditional project thinking is to build products first and then match users. Since the memecoin community has been naturally formed, can building a product containing memecoin to attract users from the community be a market strategy that can be considered?

For example, BONKbot is a Telegram trading robot on Solana, which originated from the BONK token. BONK is a Memecoin on Solana that was airdropped to users in late 2022. Subsequently, an independent team launched a trading bot that uses part of the fees generated by transactions to buy and burn BONK tokens, thereby aligning economically with token holders. BONKbot's daily trading volume recently exceeded $200 million (compared to Base's daily trading volume of about $200 million).

Since meme is a hype culture, the narrative of this coin itself is not outstanding. If the meme community can be combined with some practical products, is it also a kind of empowerment for itself?