Not all cryptocurrency developers are driven by such altruistic ambitions. Some cryptocurrency developers just want to have a bit of fun. Enter the popular phenomenon, meme coins. Developers of major cryptocurrencies such as bitcoin and ethereum, which both run on decentralized computer networks, hope to transform the global financial system for the better.
They hope that their software can help empower individuals and strengthen economic freedom. But the trajectory of crypto’s global adoption suggests the dream of a more decentralized, fair society could become a reality within a generation. On the other hand, meme coins are different. Before going through a list of some of the most popular meme coins, let’s first examine what they are.
In this guide:
What are meme coins?
Meme coins are cryptocurrencies that were essentially created as a joke. That was certainly the inspiration for the creation of Dogecoin. Given the substantial returns that Dogecoin has delivered to early investors, a series of copycat dog coins have sprung up. The motive for the creation of these copycat meme coins likely has more to do with the desire for high returns, rather than as a joke.
Some meme coins run on their own blockchains, powered by their own decentralized network of computers. Others run as tokens on top of other cryptocurrency networks — for example, as ERC-20 tokens on the Ethereum network.
The original meme coin: Dogecoin
The first meme coin ever created was Dogecoin. Software developers Billy Markus and Jackson Palmer launched Dogecoin’s mainnet in 2013 as a fork of Litecoin. Markus initially came up with the idea, getting his inspiration from a popular internet Shiba Inu meme. Palmer later helped Markus turn his idea into a workable cryptocurrency.
At the end of 2013, Dogecoin was trading on cryptocurrency exchanges in the $0.0003–7 region. In early 2014, it surpassed $0.001 for the first time. It took more than four years for Dogecoin to surpass $0.01 for the first time in mid-2018. Then, in May 2021, it briefly reached around $0.74 per coin. That represented a more than 1000x return versus its early 2014 levels.
As of October 2022, Dogecoin’s market capitalization — the market value of all outstanding tokens — is close to $8 billion. That means Dogecoin is more valuable than U.S. tech company Dropbox.
What makes meme coins so popular?
There is no definitive answer to this question. Different investors take an interest in meme tokens for different reasons. Many investors find meme coins attractive due to the potential for rapid gains. Popular meme coins like Dogecoin and Shiba Inu have a well-documented history of posting rapid, exponential price gains.
Others enjoy the fact that meme coins represent crypto’s light-hearted side. Many might be a fan of the specific meme, dog, or another animal that the meme coin was inspired by. For these investors, the meme coin might serve as more of a collector’s item.
What are the risks of investing in meme coins?
Volatility
Meme coins are generally viewed as lacking in utility when compared to the major cryptocurrencies such as bitcoin and ethereum. Their utility mainly comes from the fact that they function as a collectors’ item. According to critics, this means they have no, or at least very little, fundamental value.
As a result, meme coin prices tend to rise and fall in tandem with the swings in emotion of their associated communities, and alongside the whims of the broader retail investment community. That means their prices can be extremely volatile and unpredictable. Adding to this volatility is the fact that meme coin distribution tends to be highly unequal. A few investors tend to hold a substantial market share, giving them an outsized ability to affect the market.
Prices can surge amid a sudden surge in Fear Of Missing Out (FOMO). Something as simple as a celebrity endorsement can trigger FOMO. Back in early 2021, billionaire Elon Musk frequently touted his support for Dogecoin. This helped pump the cryptocurrency as much as 20,000% in the year.
Just as quickly as FOMO can boost prices, panic selling can trigger a crash. As of October 2022, DOGE is changing hands around $0.06, over 90% lower than the record highs it hit at $0.75 last year. SHIB is changing hands around $0.000001, nearly 90% lower than the record highs from 2021.
For investors who bought at or near the top as FOMO peaked, they have lost nearly all of their money. Meanwhile, popular meme coins can impact each other’s prices. For example, one coin may crash in price as investors flock to the new fashionable meme coin.
Rug pulls
Meme coin investors also risk falling foul of rug-pull scams. A high-profile example earlier this year was the Squid Game meme coin, which at the time piggybacked off of the popularity of a Netflix show which went by the same name.
After surging in price, and after the creators of SQUID cashed out on their tokens, Squid’s development team suddenly pulled the rug on their “project” and disappeared. SQUID tokens lost nearly all of their value immediately. Holders were even blocked from being able to sell.
How to buy meme coins?
Meme coins are easy to buy on most major cryptocurrency exchanges. The process only takes a few steps on simple-to-use platforms such as OKX. Here is an example of how to quickly buy Dogecoin via OKX.
- Once you have set up and verified your OKX account, log into the platform. Make sure to click on the “Exchange” tab in the top left. Now hover over the “Buy crypto” tab at the top of the page. You then want to press “Buy with card”.
- Press You will now be directed to a page where you can enter the amount of cryptocurrency you want to buy and what fiat currency you want to buy it with.
- After selecting the fiat currency you wish to pay in, enter the amount of crypto you want to buy.
- You will now be directed to a page that allows you to choose your preferred payment method.
- Scroll down to see a preview of the exchange rate you will receive. Hit “Pay” to buy. If you have not yet entered your card details or completed certain KYC requirements, this is where you will be prompted to do so.
Should you invest in meme coins?
For professional/serious investors and traders, trading meme coins offers the potential for rapid gains. That is also the case for casual/retail investors. But meme coin prices move rapidly. This complicates things for investors who don’t always watch markets. For this reason, casual investors likely face a higher risk of incurring substantial losses on their meme coin investments.
When it comes down to it, whether to invest in meme coins is up to the individual. If an investor is happy to own an asset that can fluctuate by orders of magnitude in a matter of days, all power to them. One piece of sound advice that most retail/casual investors are advised to follow, however, is not to invest more money in meme coins than they can afford to lose. Plowing one’s life savings into the latest trending meme coin could make a person rich, but could just as easily end in disaster and leave a person broke.
Will meme coins continue to flourish?
Meme coins have risen to prominence in the past few years, all riding on the back of Dogecoin. Now, the focus is on increasing the utility of the tokens, with many projects switching to games and technical developments to boost usage.
The market will likely see many more meme coins going forward. However, as it stands, the ones mentioned in this list are dominating the niche and are expanding with more features. These may even change the nature of meme coins, which could result in an interesting future.
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