SHIB's market value jumps into the top ten, will Meme currency rise again?

Date: November 2021

Date: November 2021

Data Sources:Dashboard for Memecoins

Since the market value of SHIB surpassed DOGE on October 28 this year, after ranking 9th in the cryptocurrency market value list, there have been news headlines mentioning SHB almost every day, including: more than 1 million tweets about SHIB in one day (October 29 ), 3 petitions lobbying Amazon to adopt SHIB coin gained over 170,000 signatures (November 4), SHIB has more Twitter followers than the Ethereum network (November 8), etc.

This isn't the first time memecoins have caught the attention of the cryptocurrency world. According to the market value and market value ranking data of Footprint Analytics, DOGE and SHIB had three very dramatic trend changes this year.

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Footprint Analytics: SHIB & DOGE Market Value Ranking

① In mid-April this year, as the price of DOGE rose to 0.4 US dollars, its market value soared to 40 billion US dollars, entering the top six in the cryptocurrency market value list;

② Immediately after this craze, SHIB appeared in May and jumped into the top 30 rankings. It is another"dog themed"Meme coins. At the same time, DOGE hit a record high with a market value of 88 billion US dollars, doubling within a month, and still maintains the top six in the ranking;

③ Five months later, SHIB replaced DOGE's top9 position in October this year, and the market value increased from US$4 billion to US$40 billion in less than 30 days, with a growth rate of more than 1000%

Even though some tokens have also experienced more than 10x or even 100x price growth, being on the market capitalization leaderboard has a certain meaning. This article attempts to demystify meme coins.

Meme coin, started from a joke.

Meme coins are actually a type of token that is inspired by meme pictures (memes) that are currently popular on most social media. The token, originally used for Dogecoin (DOGE), emerged back in 2013 when two software developers created it as a joke to mock Bitcoin.

Therefore, for a long time, Meme currency was considered to be nothing more than a joke. It was not until 2021 that Elon Musk expressed positive remarks on DOGE on Twitter, and the popularity and value of DOGE soared. Also, as it becomes easier to create cryptocurrencies, more meme coins are starting to enter the cryptocurrency market.

For example, meme.com is a protocol and platform for creating Meme Coins, which people can monetize by creating Memetic Asset mTokens through the Meme Marketplace. Interestingly, this platform uses Memecoin as the full name of its protocol, MEM for short.

About DOGE and SHIB

DOGE

and"Wow "and"so tired", after this Shiba Inu photo was taken by a Japanese teacher in 2020, it spread on various social media and gained high popularity.

Although DOGE initially ridiculed Bitcoin by adopting a block generation mechanism similar to Bitcoin, the creators of DOGE, Jackon and Billy, actually took advantage of the psychological element of social identity and participated in different societies by uniting the DOGE community. Activities to prove its real value, thereby increasing public attention.

For example, in 2014, the DOGE community managed to raise more than $30,000 worth of DOGE within hours to help the Jamaican bobsled team participate in the 2014 Winter Olympics in Sochi, Russia; another community-driven project called"Doge4kids ", which successfully donated $30,000 to the 4 Paws of Ability charity, which helps provide service dogs to children with special needs.

The spirit of DOGE represents Web3.0 to some extent: encouraging contributions and uniting the community, which explains why so many celebrities, such as Snoop Dog, Lil Yachty, Mia Khalifa, favor DOGE, not to mention the dog Coin's number one fan is Elon Musk.

SHIB

Shiba Inu (SHIB) is composed of one (or more) known as"Ryoshi "Created by anonymous people in August 2020, unlike DOGE's mechanism, SHIB is mainly based on Ethereum.

In its white paper, SHIB is described as being"An Experiment in Decentralized Spontaneous Community Building". But anecdotally, SHIB was created as an alternative to mocking DOGE, in the words of crypto investment fund Volt Equity CEO Tad Park, yes"A joke within a joke, a meme within a meme". Although called"DOGE killer", but the popularity of SHIB has mainly exploded due to its community-driven price appreciation.

There are many more meme coins, not just dog-themed, such as SAMON, HOGE, SAFEMOON, and even ELON. Most of these meme coins have similar characteristics.

5 Features of Meme Coin

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Footprint Analytics: Top 10 Meme Coins by Market Cap (2011/11/11)

Footprint's data shows that most memecoins provide a very large total supply (of which DOGE is infinite), ranging from millions to even trillions.

Has a large number of new user addresses

The cost of buying meme coins in the early days was very low, and even though SHIB ranks 11th by market capitalization, the price of SHIB is still very low today compared to other types of tokens. Low prices have attracted many investors new to cryptocurrencies, holding small amounts of capital and not knowing how to choose valuable tokens. They don't need to go through any strict selection principles, invest limited funds with their eyes closed, some even as low as 1 dollar, and quietly wait for the next miracle like SHIB to appear.

Meme coins are also often used as rewards, and airdrops are given to some celebrities who hold certain coins or coins (their wallet addresses are not difficult to find). DOGE can be said to be the first token for most newcomers when they enter the encryption world. The Dogecoin community was developed in Reddit at that time.

Almost 100% allocated to the community

Since there is no pre-allocation, the proportion of the team is very low, and there are no so-called early investors, the Meme coin project allocates 100% of its tokens to the community. They are completely decentralized.

Start with a low market cap

Typically, the starting market cap for a new meme coin is very low, $10,000 or less. This leads to a relatively high turnover rate: early speculators earn spread profits from price changes, and are then replaced by subsequent new believers who believe that prices will continue to rise.

it's a joke

As mentioned above, Meme coin started as a joke, and the story behind it (even worthless) is usually given by giant whales or countless retail investors.

Thoughts on Meme Coin

The appeal of meme coins like DOGE and SHIB is primarily through their inherent cheapness, giving the community the opportunity to align with the way the cryptocurrency world is built: a bottom-up approach that prevails in the community.

Meme currency has been accepted by more and more people because it provides investors with the opportunity to hold a whole"Token"opportunities without risking or over-leveraging for pure speculation and using these tokens to participate in community activities.

As the popularity of memecoins skyrocketed, this phenomenon greatly increased the likelihood that inexperienced investors would fall victim to malicious scams or price manipulation. Although some Meme coins have good wishes and stories, there are also too many disadvantages:

● Many Meme coins have no real use;

● Some meme coins have an infinite supply, unlike Bitcoin's finite supply. This mechanism is an influencing consideration on whether the token has long-term value;

● The token price of some Meme coins is very unstable;

● Taking advantage of the convenience of issuing coins, some Meme coin projects are often used as fraudulent projects to attract public attention by raising prices, and then sell them in large quantities, causing the currency price to return to zero

Inherently, having 100 million meme coins may be more attractive or exciting, but the reality is that there are no shortcuts to true wealth creation, no matter how mysterious or attractive the project’s story and marketing may seem.

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The above content is only a personal opinion, for reference and communication only, and does not constitute investment advice. If there are obvious understanding or data errors, feedback is welcome.

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