What Is a Meme Coin?

What Is a Meme Currency?

What is a meme coin?  Meme coin meaning includes two parts. Memes are trends that spread very quickly in the community, becoming ubiquitous. Memes can be pictures, information, sayings, hobbies, etc. In this case, some digital coins have become memes. 

Meme tokens rarely have any real value. Moreover, meme currencies are not always based on their own blockchains. Rather, most of them are cryptocurrency-covered raffles. They reflect current Internet events, represent online communities, promote the ideas of influencers, or simply publicize their personality.

How Did Meme Tokens Appear?

The aggregator CoinMarketCap identifies about 90% of the assets presented on it as meme coins. This, without further ado, speaks volumes about the popularity of meme culture in the cryptocurrency community. But no one has eclipsed Dogecoin yet.

Dogecoin was the first meme coin that appeared in 2013. It is considered a full-fledged representative of this class of tokens. This is a fork from a fork of Bitcoin, made on its blockchain. The DOGE coin is symbolized by a dog of the Shiba Inu breed, whose cunning face is a famous meme in itself. This token does not have any special value, but it has the support of such a well-known entrepreneur as Elon Musk.

Dogecoin has a working ecosystem, is supported by millions of users, and fees on the DOGE network are among the lowest. The token has many clones.The comic cryptocurrency has outlived most of its peers, and is doing quite well.

Although in fairness, it is worth remembering another, earlier token that was not a meme coin in the strict sense, but still had some of its features. This is Bytecoin, which playfully imitated the word Bitcoin.  Despite this humoristic element, this is a serious project that has influenced another cryptocurrency, Monero.

The token was created in 2012. But in 2014, Bytecoin lost the trust of the online crypto community and failed to restore its reputation. The scandal began because the developers initially kept 80% of all tokens on the network for themselves, and did not tell other participants about it. So now Bytecoin is somewhere far away in the backyard.

What Are the Typical Meme Coins Features?

Meme coins should have a set of features that distinguish them from other blockchain projects. Main features of meme tokens include:

Obvious uselessness. Meme tokens have no intrinsic value. They do not have technical uniqueness in the form of their own blockchain and are generally launched on other blockchains. For example, Dogecoin was launched on Litecoin, and Shiba Inu (one of the famous copycats of Dogecoin) was launched on Ethereum.

Regular pumps and dumps. Most meme coins have low liquidity and a low price, so it is quite easy to manipulate them. By the way, if traders buy a meme token in bulk, it grows in price, and if they sell it in bulk, it falls. Usually, after artificially raising the price of a token, it is sold when investors who are not the instigators of the scheme enter into transactions. For example, WallStreetBets investors managed to raise the price of Dogecoin ten times in a day. Although such events are not always planned. For example, after Mark Zuckerberg posted a photo of his goats and signed the publication “My goats: Max and Bitcoin”, the Aqua Goat Finance meme token rose in price in just a few days.

Celebrities can influence price fluctuations. The story of Zuckerberg's goats is great here, but one of the most obvious headliners of meme tokens is a businessman Elon Musk. Dogecoin has risen in value, not least thanks to Musk's personality as he frequently tweets about the token. 

Moreover, Elon's influence on the crypto market has got its own name. Most of you have probably heard of the Mask Effect. It was also observed in the case of other tokens. For example, the song “Baby Shark” mentioned by Musk was enough to raise the price of the cryptocurrency of the same name from the bottom.

Low liquidity ratios. Not all meme tokens are lucky like Dogecoin, which is listed on almost all major crypto exchanges. Most meme coins languish in obscurity, trading on only a few platforms. And if they also have a low capitalization, then it is generally unrealistic to find such a token on serious platforms.

Huge emission. Most projects produce such a large number of coins that it is even difficult to write such numbers. For example, Shiba Inu has issued a quadrillion coins, which is a number with 15 zeros.

Usually mem tokens are distributed immediately after creation. If you're lucky, they become viral, and if not, they gradually disappear from the horizon. Besides Dogecoin, which became the very first and most popular meme token, there are many other meme cryptocurrencies that have gained notoriety and could become as popular as the pioneer.

How to Buy a Meme Coin?

One of the main problems of people who want to buy meme coins is that it is not so easy to find a platform where you can make a purchase. Most cryptocurrency exchanges do not include them in their quotes (with the exception of the largest and most sensational projects).

Let us consider several available ways to buy meme coins:

Cryptocurrency exchanges like Binance, OKEx, EXMO, Gate.io, Currency.com and many more. To be able to buy a token via such apps, you need not only to register, but also to pass verification. If this is not done, you will not be able to withdraw the crypto, and most financial transactions will not be available.

P2p sites. There are not many peer-to-peer sites that are ready to work with meme tokens. The largest are Binance P2P and Bitzlato. But not all of them work with fiat.

Exchangers. Since the list of exchangers that offer such services is changing, it is better to follow the latest data.

Cryptocurrency wallets. Via some wallets, it is possible to get one crypt for another or even buy meme tokens for money from a bank card.

Payment systems. Recently, Payeer has made it possible to buy a meme token.

Telegram bots. The advantage of this method is its simplicity, but you need to choose a reliable bot.

Cryptomats. Most often, ATMs only support DOGE, so if you are interested in buying another token, you will have to look for an alternative. Dogecoin can be found on almost every cryptocurrency exchange, including industry leaders Binance, Huobi, and Kraken. There are several reasons for this. This token is old enough to prove it's not a fluke. It appeared back in 2013. Secondly, it is supported by famous people. For example, by Elon Musk. Thirdly, the coin has a high capitalization.

Less popular tokens are only listed on a limited number of exchanges. For example, if you need to buy Shiba Inu – the second largest Shiba Inu token in terms of capitalization – you will have to search. Offers are only available on select exchanges, including Binance, Crypto.com, and KuCoin. You can also make a purchase on a decentralized exchange like Uniswap. Dogelon Mars is sold on Binance and Nexo.

If you want to buy tokens for fiat, you will first have to buy a crypto, and then make a deal to buy a crypto meme you like. The purchased meme can be left in the exchange wallet or withdrawn to your cryptocurrency wallet.

How to Create a Meme Coin?

Technically speaking, creating a meme token is not a very difficult task. But in order for the crypto community to notice it, promotion is required, and this is already a more complex and costly undertaking. If you still want to create your own token, the algorithm is simple:

You can start by installing a browser extension (like Metamask or the like).

Look online for an Ethereum smart contract template (you can choose another blockchain, but Ethereum is the most popular option). The templates are already there, it remains to slightly correct the data you are interested in. For example, changing the name, etc.

The finished smart contract after editing is sent to the blockchain. Don't forget to pay the commission. The commission is needed for the smart contract to be executed. Depending on the level of network congestion, the price of a smart contract can be $30-$50 or even higher. The meme token is ready. 

But since the price of crypto-memes directly depends on the hype that has formed around them, you should not expect that tokens will immediately become popular. For example, Dogecoin got its current popularity thanks to Elon Musk's tweets. That is, in order for a coin to become famous, influencers must take it up.

With the initial distribution of coins, most of it can be sent to celebrities. For example, the Shiba Inu distributed some of their coins to Vitalik Buterin (co-founder of Ethereum). The developers of Dogelon Mars did the same. And now these meme tokens are in the second and third positions in terms of capitalization.

Promising Meme Coins: How to Find the Perfect Project?

Even with the overall positive outlook, investing in meme tokens is still a particularly risky proposition. But the risks can be significantly minimized if you find an interesting token, and not a deliberate scam. Here are some tips. To find a diamond among a pile of stones, you need to pay attention to the following nuances and signs:

Distribution of tokens during ICO/IDO. If most of the tokens are held by the development team or a specific person (even if it is Buterin), it is undesirable to invest there. If the developers have the entire pool of liquidity on the exchange, they can take it at any time, and take ETHs which at that time were inside the pool, also. This is rugpull. It was rugpull that caused the downfall of Squid Game.

Does the project have a commission? Inside the network where the meme token works, you have to pay a commission anyway, but some memes charge additional fees. Moreover, it can not only be very impressive, but also opaque. Such meme tokens should also be discarded.

Goals. It is important that the project has interesting ideas that can provoke the growth of the token in the future. And if there were attempts to pump, it is better not to invest.

The investor needs to pay attention to the overall potential of the meme. Not only a cute picture is important, but also a concept. A product should arouse interest, be unusual and attract attention.

Experts have not yet formed a common opinion regarding meme coins. Some say that such tokens have no place in an investment portfolio, others argue that memes are a great way to quickly make money on exchange rate fluctuations.

In addition, some companies and public figures contribute to the popularization of meme tokens. For example, Dogecoin is accepted as a payment method at the AMC cinema chain. Large trading platforms also do not bypass memes. 

The prospects for meme coins are completely dependent on whether large platforms accept them or not. For example, after the Kraken exchange announced the listing of SHIB, the price of the token rose noticeably.

 

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