What Are Meme Coins: The People-Driven Market Phenomenon Explained
Memes are the predecessor of a new generation of humans. Meme coins are the predecessor of a new generation of traders. Plowing through night and day at a record-breaking speed is a slew of cryptocurrencies that have their roots deep in the internet space. Some believe these coins are a joke that works against the industry. Others believe this is the hook to get more and more people to become traders. One thing, however, is a fact – meme coins could be more than they seem. Here is what you need to know about the latest trading opportunity on the crypto market born from a culture of online jokes.
The advent of meme coins
While everyone was looking at Bitcoin and Ethereum, in 2013, Dogecoin (DOGE) was born. The crypto market was still in its early years and at first, it was no more than a meme. However, now it is sitting at fourth place by market cap in the hall of fame of cryptocurrencies. Its rise naturally came with the potential to have successors. Low and behold the following decade and it now has its own meme spin-off – the Shiba Inu token (SHIB).
‘So, what are meme coins and how do they actually come into being?’ A fair question indeed. A meme is no more than an idea wrapped in a comedic form, be that a picture, video, or something else, that spreads from one person to another through the internet. At the same time, memes are much more than just a funny idea someone had. They can pull out to the surface a part of ourselves that is, in a way, evolutionary, by being grounded in our genes through neural links that allow us to make complex associations. And yes, there is an actual scientific study on that.
Meme coins follow the same pattern as regular memes do. They come out as a cryptocurrency variant of a joke until someone takes them seriously. That’s what happened with Dogecoin when Elon Musk decided to invest in it years ago, and that’s what happened with the Shiba Inu token just recently as well. No wonder he’s called the dogefather (but more on that later). It is sometimes said that jokes contain a portion of truth within them, and supposedly, that’s what makes some of them so good. Perhaps memes and meme coins are not far from today’s cryptocurrency trading reality either.
The power of memes is real
Reddit is a famous forum space full of all kinds of communities. One of them is r/WallStreetBets – a name that may resound strongly with those looking to get into trading. However, to many who actually visit regularly and maybe even partake in discussions within the subreddit, it is but a meme… With a twist. You either get burned by leaning on anonymous people’s words, or you learn how to recognize when the info on the boards could be legit.
The famous brick-and-mortar video games retailer GameStop was struggling to make ends meet ever since 2015. At some point, its stock price had fallen to $3.08. It was closing off hundreds of locations permanently. The $340 million profit in 2011 had turned into a $470 million loss in 2019. The time to jump ship was nearing.
A sob story, isn’t it?
The 71.2 million shares of GameStop stock that involved a short position had reached and breached the publicly tradable shares limit. Believe it or not, a subredditor on r/WallStreetBets actually saw this coming and even included explanations on how the stock could be driven back up and have everyone profit. And that’s exactly what happened, causing a short squeeze that puts rich investors on the losing side with billions on the table.
AMC’s story is quite similar, with stocks being driven up by Reddit-inspired investors. It’s a weird world we live in. And while experts say Shiba Inu coin is pointless, there is no harm in checking out some of the meme coins that have been increasing in popularity.
Shiba Inu (SHIB)
Going by the humble title of ‘Doge Killer’, SHIB could become an alternative to the DOGE, as is ETH to BTC. It was launched under the Ethereum blockchain’s ERC20 and trades on the Uniswap network. SHIB’s market cap is sitting at $11,429,119,728 as of the time of writing, trading at $0.00002895. Hopes of hitting a $1 soon may take a while longer than expected.
In the West, it’s Elon Musk who, on Twitter, decided to adopt all kinds of puppies that earned him the title of a dogefather. Other meme coins from the canine family that are steadily growing in popularity include Kisha Inu, UnderDog (DOG), Floki Inu (FLOKI), Husky Coin (HUSKY), Doge Token (DOGET), Doge Killer (LEASH), and DogeFI (DOGEFI).