Cryptocurrencies are volatile by design and that makes market movements extremely difficult to predict. After being in crypto for a while, you start to realize that crypto fads come and go all the time, and no one can foresee when the next one is going to hit or what shape it is going to take. You can learn how to buy Bitcoin or how to reduce risks associated with trading and investing in digital currencies, but spotting future trends relies more on guesswork than science and research. Not even versed financial analysts or crypto experts can claim to know what’s going to happen in this highly complex and rapidly shifting industry.
Over the years, we’ve seen a lot of these fads emerge and disappear. Some enjoyed a longer time in the limelight and left a deeper mark in crypto’s history, others shone briefly and then faded away like a shooting star, leaving but a fleeting trail of light in their wake. Sometimes, fads don’t disappear completely; they just take a back seat for a while and then they come back stronger than before, and that’s also the case with the infamous meme coins.
After disappearing from investors’ radar for quite some time, meme coins are once again rallying and making waves in the crypto sphere. What’s all the hype about and how long is it going to last this time? These are the questions on every crypto enthusiast’s mind right now.
What are meme coins?
For those who have tuned in to the cryptoverse after the first golden age of meme coins ended, we should start by explaining what meme coins are. As the name suggests, meme coins are a distinct category of digital assets inspired by popular internet memes. They often use animated characters as their symbol and they attract a large number of supporters due to the buzz they create and their high reward potential.
The first meme coin, Dogecoin (DOGE), was created in 2013 by software engineers Billy Markus and Jackson Palmer as a parody of the hype around Bitcoin and other popular digital currencies at the moment. But the joke turned into a phenomenon in 2021, after Tesla CEO Elon Musk tweeted about it, dubbing it the people’s crypto. Whether Musk intended to shake things up in the crypto industry or not, the Dogecoin price surged immediately after the event and meme coins became an instant hit.
Dogecoin’s success inspired the creation of other meme coins such as Shiba Inu (SHIB), and Big Eyes Coin (BIG), but DOGE remains to this day the leader of the meme coin pack. However, as many analysts predicted, their period of glory was short-lived. The latest crypto winter caused a massive drop in price and popularity for meme coins, leading many to believe that meme coins are on the brink of extinction. However, 2023 has brought a resurgence of these humorous tokens, proving once again that it’s impossible to predict how things will unfold in the crypto market.
Meme coins are riding the popularity wave once again
If you’re up to date with the latest crypto news, you probably know that the crypto winter is slowly subsiding and we’re now in full meme season. It almost feels like the 2021 scenario when meme coins became all the rage in the crypto space is repeating. But this time it’s not just Dogecoin or Shiba Inu at the forefront of the meme craze. Other tokens have entered the space, piquing the interest of traders and investors.
Pepe Coin (PEPE), a new meme coin based on the renowned animated character Pepe the Frog seems to be at the forefront of the movement. Pepe Coin was created by an anonymous team of developers and launched on April 16, 2023. Since then, the token made it to the top 50 traded cryptos and managed to surpass $1 billion in market capitalization. That’s pretty impressive for a meme coin, considering that it took Dogecoin almost four years to achieve the same performance.
However, PEPE is not the only meme coin that is fueling this period of resurgence. Other projects such as ArbDoge AI (AIDOGE), and Love Hate Inu (LHINU) have also been gaining traction lately. While AIDOGE is capitalizing on its connection with the increasingly popular AI technology, LHINU introduces an innovative voting system that enables users to take part in polls and get rewarded for expressing their opinions on a variety of topics. The staggering growth that some of these tokens are enjoying at the moment provides new opportunities for traders and investors looking for promising crypto projects.
Weighing the pros and the cons
Meme coins may be fun and popular, but they remain a very controversial class of assets. A lot of people are wondering if their presence is enriching the crypto space or if they are just a mere joke, as their name implies, that is meant to distract us from more important crypto matters.
The truth is that as with most crypto assets, there are both pros and cons to meme coins. On the positive side, meme coins can serve as a gateway to crypto for first-time traders and investors since they are easily accessible and affordable. They can also provide lucrative opportunities for making quick profits due to their low price point and increasing popularity.
On the downside, meme coins are highly volatile, even more than other digital currencies, making them an extremely risky investment. Some argue that meme coins are causing more harm than good since they undermine crypto’s credibility by turning everything into a joke. This can be detrimental to an emerging industry that is trying to build trust and confidence with users.
In the end, meme coins are just another subset of the crypto market, so the same rules apply when it comes to trading or investing in these tokens. Therefore, education and research are key for minimizing risks and ensuring a safe trading experience.