Institutions are entering the market? Can Memecoin continue to hold the main market in Q4?

Source: Vernacular Blockchain

According to a report released by CEX Bybit in June, institutional investors' holdings of spot Memecoin increased from $62.5 million to $204.8 million between February and March this year, and peaked in April with total holdings of $293.7 million. The most popular Memecoins include DOGE, SHIB, PEPE, and BONK. Subsequently, after the market sentiment deteriorated and Memecoins were sold off, the total holdings fell to $139 million, but this holding increase was also 125% higher than the beginning of the year.

It can be said that since the beginning of this year, Memecoin has increasingly become an important focus of institutional investors, and unlike the short-lived Memecoin craze in the past, Memecoin has become an important narrative and hot spot in this round of market cycle.

Since the second half of 2024, some VCs have also announced that they will invest in Memecoin infrastructure. Memecoin has changed from being opposed by VCs to being gradually accepted by VCs. So how did these venture capital institutions get involved in Memecoin?

1. a16z

A16z, full name Andreessen Horowitz, is a well-known American venture capital company founded by Marc Andreessen and Ben Horowitz in 2009 and headquartered in Silicon Valley. It invested in Facebook, Twitter, Instagram and Airbnb in the early days, and continued to make efforts in the fields of Web3 and blockchain. It has invested in Coinbase and gained a lot. It has also established multiple crypto funds and become one of the important investors in the crypto industry.

However, as a mainstream venture capital institution, a16z's initial attitude towards Memecoin, which has seized the market, was not very friendly. Between February and April this year, the Memecoin market skyrocketed, whether it was the average weekly increase of 6 times for 20 popular Memecoins such as PEPE, or the rapid listing of CEX such as WIF and BOME, which snatched the market share of VC Token.

A16z Crypto's Chief Technology Officer Eddy Lazzarin once severely criticized Memecoin in a tweet on April 25, 2024, saying that it undermined the "long-term vision" of cryptocurrency, tarnished the "public, regulators and entrepreneurs"' views on the industry, and acted as a casino for "relatively few people."

A16Z's Managing Partner and Chief Technology Officer Chris Dixon also published an article to denounce Memecoin, saying that Memecoin is simply a casino.

However, recently, a16z has changed its critical attitude towards Memecoin in the first half of the year and frequently participated in MemeCoin.

First, a16z co-founder Andreessen Horowitz rewarded $50,000 in BTC to the robot account Truth Terminal on X, which gave birth to the recently popular goat coin GOAT, pushing GOAT from an obscure project to a shocking historical high market value of $850 million, and Truth Terminal became the first AI millionaire, which also promoted the development of AI+Meme.

Then on the morning of October 28, Marc posted two related contents about AI16Z, which quickly attracted attention to AI16Z. This "AI16Z Fund" was created by the Twitter account "Marc 'AI' ndreessen", which launched the fund on daos.fun. The fund manages about 420 SOL of raised funds through AI dialogue, invests exclusively in Memecoin, and simulates Marc Andreessen's personality.

Before October 27, the market value of the fund was about 4 million US dollars. However, after Marc retweeted a cartoon image of a T-shirt with ai16z pattern, the market value of AI16Z soared more than 20 times in just 12 hours, reaching a high of nearly $100 million.

While some sources have linked it to the well-known venture capital firm a16z, believing that the fund may have received support from the company, Andreessen Horowitz has not officially confirmed its relationship with the project. Therefore, it is unclear whether the token is truly supported by a16z or just borrowed a similar name to attract attention. However, it is clear that a16z no longer denounces Memecoin as before.

2. DWF Labs

Founded in 2022, DWF Labs is a new generation of Web3 investors and market makers, investing in several well-known projects, including dYdX, SushiSwap, Injective Protocol, Astar Network, and Morpheus Network.

According to relevant information, DWF Labs has invested in multiple Memecoins and has been involved in them for a long time.In 2023, it invested in the pet Shiba Inu "Floki" (FLOKI) several times, and invested a further $12 million in 2024.These funds support multiple development projects of FLOKI, such as FlokiFi (decentralized finance), Floki University, the educational platform of the Floki Inu ecosystem, and its metaverse game Valhalla. This series of investments not only drove up the price of FLOKI, but also helped it successfully log in to several important trading platforms.

An additional $5 million was invested in Milady Meme Coin (LADYS) on June 3, 2024.This funding is intended to support Milady Meme Coin’s growth in the memecoin market, enhance its development capabilities, and promote community engagement.

In August 2024, DWF Labs partnered with Floki and BNB Chain to launch Memecoin Simon’s Cat exclusively on the BNB Chain.Simon’s Cat is a world-famous cat animation series and a very popular cat meme package.

In September 2024, DWF Labs announced a partnership with GraFun to support the launch of Tokens on the GraFun platform, with the goal of supporting Memecoin projects released on the GraFun platform by enhancing liquidity.

Andrey Grachev, managing partner of DWF Labs, expressed great enthusiasm for the cooperation: "Working with GraFun is an exciting opportunity to support the next generation of Memecoin projects on BNB Chain."

GraFun's BigGra agreed with this, saying: "The cooperation with DWF Labs is an important milestone for both GraFun and the Memecoin ecosystem. We believe that this partnership will bring great value to our community and the broader market."

Andrei Grachev once posted on the X platform: "The Memecoin market has become a mature and solid part of the industry. It takes advantage of extreme fear and greed, allowing smart investors and traders to make huge fortunes. DWF Labs institutionalized investment in Memecoin a few years ago, and this remains one of our priorities."

3. Binance Labs

Binance Labs is a leading global blockchain and crypto investment institution, affiliated with crypto CEX Binance, founded in 2018. Currently, it has invested in many well-known crypto projects, including Coinbase, Polygon, Injective Protocol, Elrond, Terra and 1inch.

As early as 2023, Binance Labs invested in multiple Memecoins,and continued to participate in the MemeCoin track in 2024.In January 2024, Binance Labs invested in Memeland's native ecological token MEME. Memeland mainly revolves around NFT and social functions. The project was included in Binance Launchpool in October 2023.

Subsequently, Binance Labs supported the development of its Whyanelephant project,which is a dancing elephant. Nonsense, free and easy, and extremely emotional fluctuations are its labels, and it also represents you and me in the crypto market.

Fourth, Coinbase Ventures

Founded in 2018 and headquartered in San Francisco, California, Coinbase Ventures is an investment arm of Coinbase, Inc., which mainly invests in early-stage companies in cryptocurrency and blockchain technology. Currently, it has invested in Compound, Chainlink, Dapper Labs, Etherscan, and Ripple.

For Memecoin, Coinbase Ventures also participated early and began to support Dogecoin as early as 2018.However, the specific investment amount has not been disclosed, but the project has accumulated a lot of support in the community. In 2021, Coinbase Ventures invested in Shiba Inu, and the parent company Coinbase announced at the end of 2023 that Bonk would be added to its list of tradable assets.

The latest news is that after the GOAT fire, Coinbase CEO Brian Armstrong proposed to set up a crypto wallet for Truth Terminal.

Then Coinbase Ventures released a proposal to explain how the combination of artificial intelligence and blockchain technology will shape the future. Coinbase said in its post: "The future of artificial intelligence can be built on blockchain technology, as crypto assets can help improve the accessibility, transparency and use cases of emerging technologies. The efficiency, borderlessness and programmability of cryptocurrencies combined with artificial intelligence have the potential to change the way humans and machines interact with the digital economy."

It can be seen that as an important institutional role in the cryptocurrency market, Coinbase has launched the popular Layer2 base chain and become the custodian of all Bitcoin spot ETFs. It also participated in the layout of the Memecoin track very early.

5. Crypto Labs

Crypto Labs is a venture capital firm founded in 2018 and headquartered in Singapore. It has invested in many well-known crypto projects, including Ripple, Filecoin, Dapper Labs, SushiSwap, Aave and Chainlink.

On October 9, 2024, PPKING, the Memecoin fair launch platform of the TON public chain, announced the completion of a $2 million seed round of financing, led by Crypto Labs.The project aims to create an efficient, secure and entertaining decentralized financial platform through innovative DeFi mechanisms and in-depth integration of MEME culture. The new funds will support its Memecoin transactions and liquidity provision.

6. Pantera Capital

Pantera Capital is a venture capital firm founded in 2013 and headquartered in California. Its founder, Dan Morehead, was a Goldman Sachs trader with extensive financial experience. It has invested in several well-known crypto projects, including Bitcoin, Ethereum, Chainlink, Dapper Labs and Polkadot.

Pantera Capital has also shown a strong interest in the memecoin field for a long time. Pantera Capital invested in Shiba Inu in 2021.

Pantera partner Paul Veradittakit emphasized that Memecoin plays an important role in attracting young users to Web3.He regards Memecoin as a "Trojan Horse" for cryptocurrency adoption, using viral popularity to establish interactions with DeFi, NFT and other decentralized services. By making encryption and blockchain applications more accessible to mainstream audiences, Pantera believes that memecoin has important value in overcoming the distribution limitations faced by NFTs, and may achieve split ownership of NFTs through the ERC-404 standard.

In recent months, Pantera executives have mentioned that Memecoin is helping platforms like Solana build a more active user base. Pantera is also actively embracing participation in the MemeCoin track.

Seventh, OKX Ventures

OKX Ventures is the venture capital department of the OKX platform, which has invested in many well-known crypto projects, including Solana, Polygon, Tether, SushiSwap and other well-known crypto projects.

OKX Ventures also participated in Memecoin investment activities relatively early.In May 2021, OKX Ventures participated in the investment in SHIB during this wave of enthusiasm. Later, it also participated in the investment in Floki Inu, BabyDogeCoin, etc.

In addition, OKX began to support the listing of various top Memecoins very early this year. It can be seen that OKX Ventures, which relies on the trading platform, is more sensitive to Memecoin.

Eight. Others

In general, because it is impossible to issue Memecoin directly for profit, most venture capital institutions cooperate with project releases by investing, and the investments are all hot Memes with backgrounds and stories.Some investment institutions were unable to participate directly or indirectly at the beginning, and once had a confrontational mentality; in addition, some investment institutions are actively deploying launchers for various public chains to further promote the spread and vitality of Memecoin.

According to RootData data, according to incomplete statistics, since 2024, there have been more than 10 new Meme Launchpads or projects with Meme Launchpad functions, and they support different public chains, with Base and Solana supporting the most Meme Launchpad projects. Behind these, we can also see some venture capital figures.