TL;DR Meme coins have pumped tremendously in the past two weeks or so. They dominate the top gainers dashboard on a weekly and monthly timeframe. In recent years, meme coins have proven that they’re more than a joke and in fact are an investible asset class within crypto. You have to know when to enter though: around the time the masses arrive. And you have to be aware of the role of meme coin ecosystems.
Before deciding if you want to jump on the doggie and/or froggie train, let’s look at the current state of meme coins, how they pump relative to the broader cycle, and various meme coin ecosystems.
Below the index are the top 5 and their percentage gains (dashboard by Messari).
Talking about meme coins, it’s really DOGE and the rest, even though Shiba Inu’s market cap is approaching that of DOGE. Dogecoin was created 7 years earlier than the number 2 on the list, Shiba Inu. The other top 5 names are even more recent.
Dogecoin is the coin of its own chain, while the others in the top 5 are tokens on Ethereum or Solana. The exception is Shiba Inu, which started out as a token on Ethereum but became its own coin on its own chain.
Market Cap of Meme Coins
According to Coingecko, the total market cap of all meme coins is 60 billion dollars – but as I’m writing, there is a lot of volatility. So this figure could change fast.
Interestingly, that’s higher than the market cap of all NFTs. It’s also bigger than sectors that are taken very seriously, such as DeFi and DePIN.
Looking at the below bubble chart, it’s clear that there are two top dogs: Doge and Shiba Inu.
At the time of writing, this is the order and market cap of the top 6:
- Dogecoin: $24B
- Shiba Inu: $21B
- Pepe: $3B
- Bonk: $1B
- Dogwifhat: $1B
- Floki: $750M
Interesting read: we compared Dogecoin vs Shiba Inu
Dialogue between a Skeptic and a Believer
To profit from meme coins, some people more than others have to take a mental hurdle. Let’s help them get over this hurdle by this dialogue between Skeptic (S) and Believer (B).
S – ‘There’s no intrinsic value in magic internet coins with a dog logo on top!’
B – ‘Or is there, normie? Show me the coins you pay with in your local grocery store, what logo do they have?’
S – ‘It is our King’s’.
B – ‘Right. So you think a coin with the picture of your King on it has somehow intrinsic value, and a coin with your beloved and Shiba Inu dog doesn’t?’
S – ‘Well, it’s our country’s currency. It’s official.’
B – ‘True, currency used to be the monopoly of nation-states. But in our age of online communication, people can cluster in communities and create economies of their own.’
S – ‘Aren’t you taking it a bit too seriously? Dogecoin or Pepecoin or whatever: they are just jokes.’
B – ‘Granted. Let’s assume this Doge joke made 500.000 million people worldwide laugh a few times. There’s value in that. People pay real money to comedians to get entertained.’
S – ‘Are you saying you want to multiply the number of times people laughed with the price per laugh to arrive at a fair market cap?’
B – ‘That’s indeed what I’m saying, and by the way it can also be other emotions than laughter. Any emotion that’s shared in a community can now be monetized’
S – ‘Crazy world we live in.’
B – ‘Indeed, so join the fun.’
Dogecoin as the First…
Erik started as a freelance writer around the time Satoshi was brewing on the whitepaper.
As a crypto investor, he is class of 2020. More of a holder than a trader, but never shy to experiment with new protocols.
