The meme-coin mania is in full effect in 2024, with cryptocurrency speculators and even serious, large-scale investors getting involved within the space. Yet, not all meme tokens are built the identical, so traders and investors should always conduct their due diligence and understand the risks involved.
The term “meme” has been around because the Seventies, but its use in popular web culture has brought the concept into the financial markets. You’ll have heard about meme stocks like GameStop (NYSE:GME) and AMC Entertainment (NYSE:AMC), that are volatile assets which have provided rapid returns for some traders but have also quickly lost money for investors who’ve made ill-timed trades.
Similarly, meme cryptocurrency coins are fast movers in each directions. Consequently, these tokens have drawn many speculators and serious investors into the fold within the 2020s.
With research and patience, you simply might find the most effective meme coins to speculate in for the summer of 2024.
The astounding growth of meme coins
Meme coins are different from other cryptocurrencies due to their lighthearted nature. Nevertheless, the profits and losses from trading them are real, so meme tokens ought to be taken seriously.
These coins may depict animals and other varieties of characters and even political figures. Moreover, meme coins are real attention-getters, and they have an inclination to incorporate a component of humor.
Perhaps most significantly, meme tokens are highly community-driven. As such, the element of investor engagement on social media platforms akin to X and Reddit is crucially necessary.
Thus, intrinsic value and real-world utility may sometimes be de-emphasized with these tokens. Consider Dogecoin (DOGE-USD) as a chief example. Imprinted with a drawing of a Shiba Inu, Dogecoin was the very first meme coin, dating all the best way back to 2013.
Few people took Dogecoin seriously upon its initial release. Yet, the token’s total market capitalization stands at a whopping $60 billion as of June 2024.
Dogecoin, which operates as a stand-alone, proof-of-work (PoW) blockchain, stays the Most worthy meme coin today. Nevertheless, it definitely doesn’t stand alone amongst today’s popular meme tokens.
Indeed, Ethereum (ETH-USD) blockchain-based ERC-20 tokens like Shiba Inu (SHIB-USD) and Pepe (PEPE-USD) have also gained in popularity, collectively growing in market value to over $100 billion in 2021.
Dogecoin and Shiba Inu are similarly themed tokens that each bear images of Shiba Inu dogs. There’s a friendly rivalry occurring between the communities of those two fascinating meme coins, and the Dogecoin versus Shiba Inu debate continues to this present day on social media.
While not a meme coin itself, Solana (SOL-USD) has played a serious role within the emergence of meme coins. This token’s popularity has exploded as a consequence of the Solana blockchain’s low transaction fees and the benefit wherein tokens may be created on the blockchain.
Latest Solana-based meme coins, including quite a few Solana Program Library (SPL) tokens, have emerged recently. Some examples of recent meme coins include dogwifhat (WIF-USD) and Jeo Boden (BODEN-USD), which proceed to achieve traction amongst crypto enthusiasts.
The old guard versus the up-and-comers
It might sound odd to label Dogecoin and Shiba Inu as old-guard meme coins. Yet, they’re two of the more established meme tokens as they’ve been around for some time and have name recognition amongst cryptocurrency traders.
The concept here isn’t to pit older meme tokens against the up-and-comers. Nevertheless, there are specific trends and shifts that meme coin traders should listen to.
For example, investors can pay attention to the open interest, which measures the mixture value of the present, unrestricted holdings of an asset amongst all traders/investors, each retail and institutional. Imagine it or not, the collective open interest of meme coins has surpassed $3 billion.
Don’t get the improper idea. Dogecoin continues to be the highest dog amongst meme coins. Actually, open interest for Dogecoin recently hit a record $1.8 billion.
At the identical time, the brand new kids on the block like Pepe are nipping at Dogecoin’s heels (or paws). In May, open interest for the Pepe coin increased by nearly 50% to a mind-blowing $850 million.
Again, the thought here isn’t to divide investors into old-school versus new-school camps. It’s still a big and growing community amongst meme-token investors wherein one coin’s success can profit the meme-coin space as an entire.
Indeed, there’s no denying that this can be a rapidly expanding space. In March (using a seven-day average) and across centralized exchanges, meme coins reached a powerful $13 billion in spot trading volumes. Consequently, meme tokens’ collective trading volumes surpassed those of non-meme tokens akin to ether (ETH-USD) and Solana.
It just goes to indicate that a way of community and fun can turn little-known assets into real blockbusters. Thus, while all the time keeping your position size reasonable, be happy to conduct your individual due diligence on the wild and wonderful world of meme coins.