Memecoin plays a crucial role in the blockchain and cryptocurrency community, and Binance Research emphasizes their unique value.
According to Binance's report, the rise of memecoin coincides with the expansion of the world's money supply. As money and capital become accessible, risky investments like Bitcoin, altcoins, and memecoin become attractive options.
Although memecoin promises strong growth, they are also a high-risk investment due to their high speculative nature and lack of use cases. However, their recent performance seems to challenge all odds—their market capitalization has increased by 22% just after the U.S. elections.
Doge and PEPE coins are two of the strongest performing coins this Wednesday, rising 15% and 11% in value, respectively.
Binance Research: 75% of total Memecoin was launched last year
According to Binance's research in November 2024, meme currency is becoming increasingly popular as people are now looking for risky investments. The report further states that the global money supply is expanding, and many retail investors are seeking alternative ways to create wealth. The market value of this segment has tripled since 2022, thanks to the popularity of these coins.
Binance's report also mentions regulatory skepticism towards initial coin offerings (ICOs). With this order, developers will now consider private venture capital funding (VC) to promote their projects. Experts call this the "Low Float and High FDV" method, meaning that only a small number of tokens are available for trading but have a higher valuation.
Memecoin remains an accessible investment option
Although this approach benefits developers and early users, it may pose risks to ordinary investors. As a result, many retail investors are seeking meme coins as an alternative investment option. These are the main reasons why meme tokens have become popular and accessible to everyone.
Binance added that about 75% of all meme currencies were launched last year. The Binance team acknowledges that many find launching these projects easy, but maintaining their operations is a challenge. According to the same report, about 97% of all memecoins have died, and the rest are struggling but still managing thanks to the hype of this year's elections.
Memecoin increased by 22% in one day due to the hype of the elections
Although these coins are seen as community-driven and accessible investments, they are also highly speculative. Many in the community have bet on the "meme coin super cycle" coinciding with Bitcoin's price surge. The bets have paid off, and the market capitalization of memecoin has now reached over $73 billion, reflecting a 22% increase.
